|
Regarding classification of Technology Transfer Agreements (TTA) and
their eligibility under Customs exemption notification as �printed books�
Circular No. 72 dated
29th November 2001
I am directed to invite your attention to the
following judgement of Hon�ble Supreme Court in the case of Commissioner of
Customs Vs. M/s. Parasampuria Synthetics Ltd., reported in 2001(133) ELT 9 (SC).
In this case, the Hon�ble Apex Court was seized with the matter regarding
interpretation of notification No.25/95-Cus., (Sl.No.10 and Sl.No.15) in respect
of technical know how imported in the form of plans, drawings and other
literature.
2. Notification
No.25/95-Cus., (Sl.No.10) exempted �printed books/printed manuals� from
customs duty whereas Sl.No.15 of the same notification prescribed a basic duty
of 10% on �plans, designs and drawings�. The importer contended that the
technical know how in the form of drawing, design, plans and other literatures
are �printed books/manuals� and therefore, fully exempted from customs duty.
3. While,
interpreting the term �printed books/manuals�, the Hon�ble Court held that
the term �book� in the general trade parlance is known by features like (i)
a book has an author, (ii) a book has a publisher, (iii) a book is a priced
publication, (iv) book is available to all and sundry who pay for it, (v) a book
does not have an MOU, (vi) there is no confidentiality about the book, (vii) a
book has a subject to deal with, (viii) the pages are serially numbered and
neatly bound and (ix) a book should have an ISBN code. Since the imported goods
did not fulfil the above conditions, the Hon�ble Court held that such goods
cannot be considered to be �books�. The Hon�ble Court also held that such
articles cannot be termed as �printed manuals� in �loose leaf form with
binder� as it contains specification in terms of a technology transfer
agreement. It is also not a collection of various articles in trade journals but
a definite importation of �technology transfer�, which obviously was not
intended to be the meaning of the word �manual�. The Hon�ble Court held
that such goods are to be assessed as �plan, design and drawings� leviable
to a concessional duty @ 10% (basic) under notification No.25/95-Cus. The
judgement may be perused for details.
4. Pending
assessments may be finalised in accordance with the above Supreme Court
judgement. Difficulties, if any, may be brought to the notice of the Board.
|