Hewlett Packard Sales Pvt. Limited Vs Principal Commissioner of Customs ACC (Import) Commissionerate (CESTAT Delhi)
CESTAT Delhi held that re-determining the value under residual provisions of rule 9 of the Customs Valuation rules without rejecting the transaction value is not sustainable in law. Accordingly, appeal allowed.
Facts- HP India imported the QR CDs from M/s Mentor Media Ltd., Singapore6 and cleared them under various Bills of Entry declaring its transaction value as the value of the CD. This value included only the cost of blank CD and some cost for copying the software. It did not include the value of the software which the CD contained.
The case of the Revenue is that the value of the CD is not the same as the blank CD plus a little towards the cost of copying the software and it should also include the cost of the software which it contains.
The case of HP India is that it declared whatever transaction price it had paid to Mentor. It did not pay anything extra for the CD or to anyone else including Microsoft USA as a condition of sale by Mentor. As per the Agreement between HP, USA and Microsoft, it had to pay, and it paid only for downloading the software. The agreement also allowed HP to copy the Windows OS in QR CDs without paying anything extra. Therefore, the only cost of the CD to HP India was what it had paid to Mentor and it declared this price in the Bills of Entry and paid duty on it.
