INDIA JAPAN LIGHTING LTD. Vs. CC

JUDGEMENT

(1.) THERE are two applications before us, both filed by the appellants, one for stay of operation of the impugned order and the other for out -of -turn disposal of the appeal. After examining the records and hearing both sides, we are of the view that the appeal itself requires to be finally disposed of at this stage. Accordingly, after allowing this application for out -of -turn hearing and disposing of the stay application, we proceed to deal with the appeal.

(2.) THE appellants had imported components for automotive lighting equipments from a Japanese company viz. M/s. Koito Manufacturing Co. Ltd. They cleared the goods on payment of duty, without including in the assessable value the technical know -how fee paid by them to the supplier under a technical licence agreement dated 24.11.95. Under the said agreement, the appellants had been licensed by the Japanese company to manufacture certain automotive lighting -equipments (referred to as 'contract products') in India by making use of the latter's technical know -how and assistance. Article 2 of the above agreement is relevant to this context. Article 3 of the agreement provided for supply by the Japanese company, of the technology required for the design, manufacture and inspection of the contract products in India by the appellants. It also provided for improvements to technology to be made from time to time. The design and manufacturing technologies were referred to as "licensed technology" in the above Article. Under Article 5, the appellants were made liable to pay to the Japanese company a total fee of US$ 9,00,000, to be paid in three equal instalments. The Customs authorities wanted to include this sum also in the assessable value of the components imported by the appellants and, accordingly, the original authority passed an order holding that (a) the appellants were related to the Japanese company in terms of Rule 2(2) (i) and (iv) of the Customs Valuation Rules, 1988 (b) the transaction value should be determined as per Rule 8 of the said Rules. (c) the technical licence fee of US$ 9,00,000 should be added to the transaction value as per Rule 9(1)(c) of the said Rules and (d) the pending provisional assessment should be finalized accordingly. Aggrieved, the assessee approached the Commissioner (Appeals) and the latter held against the assessee. The decision of the appellate authority was taken in appeal to this Tribunal and that appeal was allowed by way of remand. Pursuant to our remand order, ld. Commissioner (Appeals) held, again, against the assessee by holding that the technical licence fee paid by them to the Japanese company was addable to the transaction value under Rule 9(1) (c). Hence the present appeal.

(3.) WE have heard ld. JCDR, who submits that he is not prepared to argue in the appeal. He has suggested that the appeal be heard on a later date.