MANDO BRAKE SYSTEMS INDIA LTD. Vs. CC

JUDGEMENT

(1.) In this appeal at the instance of the importer challenge is against the order passed by the Commissioner of Customs (Appeals) Chennai dated 28.2.2003. The issue arising in this case for consideration is whether the technical licence fee can be loaded to the value of the goods imported by the appellant.

(2.) The appellant is a joint venture company established with the objective of manufacture, fabrication, assembly and sale of fully automotive brake systems and related components. It entered into a Licence and Technical Assistance Agreement (LTAA) with Mando Machinery corporation, Korea. As per the terms of the agreement the appellant was to pay total sum of US 4,50,000 to Mando, Korea as consideration for "the rights and technical information granted, disclosed and furnished by" Mando, Korea. The sum was to be paid in four instalments. The agreement also provided for payment of royalty at 3% of the net ex -factory sale price of the licensed product. Since we are not concerned in this appeal with the payment of royalty, it is not necessary to go into the details of the same.

(3.) As per definition of the term "Technical Information" contained in Article 1.2 of the Agreement, Technical Information means 'technical knowledge, know -how, drawings, specifications, manufacturing information, data and experience of the Licensor, whether patented or not, as far as they are related to the manufacture. The term 'Licensed Product' has been defined to include: -