Page 102 - ELT_15th May 2020_VOL 372_Part 4th

492 EXCISE LAW TIMES [ Vol. 372

seller” to a third party. There was also no payment made as a condition of
sale of imported goods as such. Rule 9(1)(e) also, therefore, has no applica-
bility.
17. So far as the Interpretative Note to Rule 4 is concerned it is no doubt
true that the Interpretative Notes are part of the Rules and hence statutory.
However, the question is one of their applicability. The part of the Interpre-
tative Note to Rule 4 relied on by the Tribunal has been couched in a nega-
tive form and is accompanied by a proviso. It means that the charges or
costs described in clauses (a), (b) and (c) are not to be included in the value
of imported goods subject to satisfying the requirement of the proviso that
the charges were distinguishable from the price actually paid or payable for
the imported goods. This part of the Interpretative Note cannot be so read
as to mean that those charges which are not covered in clauses (a) to (c) are
available to be included in the value of the imported goods. To illustrate, if
the seller has undertaken to erect or assemble the machinery after its impor-
tation into India and levied certain charges for rendering such service the
price paid therefor shall not be liable to be included in the value of the
goods if it has been paid separately and is clearly distinguishable from the
price actually paid or payable for the imported goods. Obviously, this In-
terpretative Note cannot be pressed into service for calculating the price of
any drawings or technical documents though separately paid by including
them in the price of imported equipments. Clause (a) in the third para of
the Note to Rule 4 is suggestive of charges for services rendered by the sell-
er in connection with construction, erection etc. of imported goods. The
value of documents and drawings etc. cannot be “charges for construction,
erection, assembly etc.” of imported goods. Alternatively, even on the view
as taken by the Tribunal on this Note, the drawings and documents having
been supplied to the buyer-importer for use during construction, erection,
assembly, maintenance etc. of imported goods, they were relatable to post-
import activity to be undertaken by the appellant. Such charges were cov-
ered by a separate contract, i.e. contract MD 301. They could not have been
included in the value of imported goods merely because the value of doc-
uments referable to imported equipments and materials was mixed up with
the value of those documents which were referable to equipment which
was yet to be procured or imported or manufactured by the appellant; the
value of the latter category of documents also being neither dutiable nor
clubbable with the value of imported goods. The Tribunal has not doubted
the genuineness of the contracts entered into between the appellant and
SNP. Rather it has observed vide para 10.2 of its order that entering into
two contracts (MD 301 and MD 302) was a legal necessity. The Tribunal has
also stated that it was not recording any finding of “skewed split-up”. Shri
Ashok Desai, the Learned Senior Counsel for the appellant has pointed out
that under Chapter Heading 49.06 of the Customs Tariff Act, 1975 plans
and drawings for engineering and industrial purposes being originals
drawn by hand as also their photographic reproductions on sensitised pa-
pers and carbon copies thereof are declared free from payment of customs
duty. Sub-rules (3) and (4) of Rule 9 clearly provide that additions to the
price actually paid or payable are permissible under the Rules if based on
objective and quantifiable data and no addition except as provided for by
Rule 9 is permissible.”
20. Revenue laid stress on the decision of this Court in the case of Essar
Gujarat (supra). We have earlier referred to this authority in this judgment. This
case involved importation of a plant, which was originally installed in Germany.
The Indian importer, Essar Gujarat, had entered into an agreement with the
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