The Andhra Petrochemicals vs Collector Of Customs Madras on 6 February, 1997
On going through the decision of the Tribunal which is reported as Andhra Petrochemical Ltd. v. CCE, Madras -1997 (91) E.L.T. 349 we find two relevant factors - (1) Davy Mekee (London) Ltd. entered into contract with M/s. APCL for supply of equipment and materials, for technical know-how and for servicing of the plant proposed to be erected. DML supplied detailed specifications for each item, standards and data sheets as listed on the engineering document list, general design requirements, layout and other relevant technical information while placing the purchase orders on the manufacturers. (2) the drawing submitted by the manufacturers were required to be reviewed and approved by DML. Equipment was required to be inspected by DML. Invoices by the manufacturer were raised on DML. In turn DML raised invoices on APL. It was contended on behalf of the appellant that the DML had not taken up themselves any responsibility for providing designs etc. necessary for the production of the imported goods and that the responsibility of DML confined to providing know-how and front end engineering package for the plant at Vizag. The Tribunal took the view that the services rendered towards engineering design, work plans, sketches etc. undertaken by the DML elsewhere than in India were necessary for the production of the imported goods got manufactured by DML and supplied to APL and therefore, the value of the services are covered by the provisions of Rule 9(1)(b)(iv) of the Customs Valuation Rules.