Whether the royalty can be added to the transaction value of Audio Compact Disc imported?

The facts leading to the filing of the present appeal are that the Appellant in this case are engaged in the marketing of audiocassettes and CDs imported inter alia from M/s Universal Manufacturing and Logistics, Germany and associated companies. Their company is a 100% subsidiary of Universal Music Holding, Netherlands.

Whether the royalty paid by the Appellant to Universal Music Holding, Netherlands on net sales in India can be added to the transaction value of Audio Compact Disc imported from Universal Manufacturing and Logistics, Germany?

·         Cassettes under question are brought to India as pre-recorded cassettes which carry the music or song of an artist. There is an agreement existing in all the matters that royalty payment is towards money to be paid to artists and producers who had produced such cassettes. Such royalty becomes due and payable as soon as cassettes are distributed and sold and therefore, such royalty becomes payable on the entire records shipped less records returned. It could therefore, be concluded that the payment of royalty was a condition of sale. Counsel appearing for the Respondent relied upon the commentary on the GATT Customs Valuation Code. We failed to see as to how the aforesaid commentary on the GATT Customs Valuation Code could be said to be applicable to the facts of the present case.

·         The specific sections and the rules quoted hereinbefore are themselves very clear and unambiguous.

BCCI CASE

The present dispute couldnot be decided due to difference of opinion of both the Judges, therefore referred to the larger bench.

TRADEMARKS, COPYRIGHT CASES SHOULD PROCEED ON DAY TO DAY BASIS

Matters relating to trademarks, copyright and patents the proviso to Order XVII Rule 1(2) C.P.C. should be strictly complied with by all the Courts, and the hearing of the suit in such matters should proceed on day to day basis and the final judgment should be given normally within four months from the date of the filing of the suit. We direct that the directions should be carried out by all courts and tribunals in this country punctually and faithfully