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482 EXCISE LAW TIMES [ Vol. 372

sustain such additions to the invoice value in respect of both the contracts. The
underlying reasoning for the said orders of the authority of first instance was
that the commercial arrangements constituted turnkey contracts and package
deal, which made it conditional for the purchaser to buy the equipments which
complied with the technical specifications of SAIL. As a consequence, sale of the
equipments was conditional as the different aspects of the schedules of supply
and service were interrelated. The transaction value of the imported goods was
directed to include the price paid for the basic design and engineering, drawings,
supervision of erection, commissioning, performance guarantee and technical
services under Rule 4 read with Rule 9(l)(e) of the 1988 Rules.
5. Appeals by SAIL against both these orders were rejected by the
Commissioner of Customs (Appeals) by two separate orders passed on 11th July,
2001 and 7th September, 2001. We find from the orders of the Appellate authority
that the case of TISCO v. Commissioner of Central Excise & Customs reported in
(2000) 3 SCC 472 = 2000 (116) E.L.T. 422 (S.C.) was cited before it by SAIL. This
decision was distinguished by the Appellate authority and the findings of the
authority of first instance was sustained on the basis of Rule 9(l)(e) of the 1988
Rules.
6. Further appeals of SAIL however, was decided in their favour by
Customs, Excise and Service Tax Appellate Tribunal, Kolkata (CESTAT) by a
common order passed on 22nd May, 2006. These appeals were registered before
the CESTAT as C/V-537/2001 and C-01/2002. The CESTAT formulated the
points for determination in the following terms :-
“[i] whether the basic design and engineering fee of DM 2.230 million and
foreign supervision charges of DM 0.675 million are liable to be added
to the invoice values of imported equipments under Rule 9 of the Val-
uation Rules? [Appeal No. C/V-537/2001]
[ii] whether the charges towards basic design and engineering fee of DM
6.650 million, fee for as built drawings of DM 0.100 million and also
supervision charges of DM 2.842 million are liable to be added to the
invoice values of the imported equipments under Rule 4 of the Valua-
tion Rules read with Section 14 of the said Act? [Appeal No. C-
1/2002]”
7. The Tribunal held that the drawings and technical documents related
to post-importation activities for assembly, construction, erection, operation and
maintenance of the plant and those items could not be included in the value of
imported goods. Referring to Rules 9(1)(b)(iv) and 9(1)(e) of the Valuation Rules
1988, the Tribunal held :-
“Similarly reliance upon the decision of the Supreme Court in Collector of
Customs (Preventive), Ahmedabad v. Essar Gujarat Ltd., 1996 (88) E.L.T. 609
(S.C.) is also completely misplaced. From the judgment of the Supreme
Court it would be seen that what has been held to be added therein under
Rule 9(1)(e) of the Valuation Rules and process license fee, the payment for
transfer of technology under the process license agreement and whatever
expenditure was needed to be incurred for dismantling the plant which
was sold on “as is where is basis” in the foreign country and making it
ready for delivery on board the vessel to be exported to India. The Supreme
Court specifically held that apart from this all other services rendered un-
der the Engineering and Consultancy fees cannot be added. The said
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