HITACHI KOKI INDIA LTD Vs. CC

JUDGEMENT

(1.) THIS is an appeal against order -in -ap -peal No. C. Cus. 1315/98, dt. 6.1.1999 wherein the Ld. Commissioner (Appeals) has upheld the loading of assessable value by 10.58% in case of goods imported by the appellants prescribed by order -in -original F. No. 850/32/96 -SVB dt. 8.10.1998.

(2.) BRIEFLY , the issue concerns assessment of imports by the appellants in whom 80% of their shares are held by their foreign technical collaborating company namely M/s. Hitachi Koki Company Ltd., Tokyo, Japan. Appellant mostly imports various items from this company for the purposes of manufacture of their final products in their factory in India. The order -in -original has noted that agreement between the appellants and the foreign supplier includes two other payments to be made by the appellants to the foreign company over a period of time. The agreement between these two companies is for a period of 7 years starting from 9.4.1996. The first item on which the payments are to be made to the said foreign company by the appellants is in the form of technical lumpsum know -how fees which, according to the said agreement between the two, is to be paid back in three instalments in three years after receipt of technical drawings. The second item on which certain sums are payable to the said foreign company is royalty on the sales turn over of the final products produced using the said imported goods. There is no dispute that on the date of passing of the order -in -original, no sums were paid on this account. Therefore, the question in dispute is whether these two payments alongwith 80% share holding by the foreign company in capital of the importing company would render the value declared on each of the said Bill of Entry as not the correct transaction value and therefore whether it would have to be determined as what would constitute the correct tansaction value?

(3.) HEARD Shri K.S. Ravishankar, Ld. Advocate for appellants and Shri S. Sankaravadivelu, Ld. DR for Revenue.