STRAPEX INDIA LTD. Vs. COMMISSIONER OF CUSTOMS (IMPORT)

JUDGEMENT

(1.) THE appeal is directed against Order -in -Appeal No. 754/MCH/DC/GVC/2012, dated 11 -9 -2012 passed by Commissioner of Customs (Appeals), Mumbai. Vide the impugned order, the lower appellate authority has upheld the assessment order passed by the Deputy Commissioner of Customs, Gatt Valuation Cell, Mumbai, vide order dated 18 -5 -2009 by rejecting the transaction value declared by the appellant, M/s. Strapex India Ltd. on the ground that the supplier, M/s. Strapex GmbH Switzerland and Interstate, Netherland are related to the appellant and the relationship has influenced the price when compared with the sales effected to unrelated buyers in India. Aggrieved of the same, the appellant is before us. The learned Counsel for the appellant submits that the appellant has entered into an International Distributorship agreement with M/s. Strapex GmbH Switzerland for distributing the latter's product in India on stock and sales basis. As per the agreement, the appellant has undertook promotion of the sale of the products of the foreign supplier in India by canvassing and indenting for the products. Further, the appellant is also precluded from selling or marketing products not manufactured by the foreign supplier. The agreement also provides for payment of overriding commission when the foreign supplier directly sells the goods to unrelated parties in India. If overriding commission paid is excluded from the sale price in respect of unrelated buyers, net sales realization by the foreign supplier would be the same irrespective of whether the sale is effected through the appellant or directly to the independent buyers. This clearly shows that relationship has not influenced the price. The learned Counsel relies to Rule 3(3)(b) of Customs Valuation (Determination of Value of Imported Goods) Rules, 2007, which reads as follows:

(2.) THE learned Additional Commissioner (AR) appearing for the Revenue reiterates the findings of the lower authorities.