Transaction value in excise valuation applies only to international sale price, leaving Rule 8 as the proper basis for domestic clearances.

For central excise valuation of clearances by a 100% export oriented unit to the domestic tariff area, the article states that Rule 3 transaction value applies only where the price reflects an international sale transaction between buyer and seller. A domestic sale price does not automatically qualify as transaction value merely because it arises from a sale. The valuation basis therefore depended on whether the domestic price corresponded to, or closely approximated, the value of like imported goods; failing that, it could not be accepted as transaction value. Rule 8 remained the proper basis for valuation, and the challenge to the adopted valuation was rejected.

---

---

Issues: Whether, for assessment of central excise duty on clearances by a 100% export oriented unit to the domestic tariff area, the assessable value was to be determined under Rule 8 of the Customs Valuation Rules or by treating the sale price as the transaction value under Rule 3.

Analysis: The transaction value contemplated by Rule 3 is the value in an international sale transaction between buyer and seller. A domestic sale price does not automatically answer that description merely because it arises from a purchase and sale transaction. The relevant basis for valuation therefore depended on whether the domestic sale price corresponded to, or closely approximated, the value of like imported goods, failing which it could not be accepted as the transaction value.

Conclusion: The challenge to the valuation adopted below was rejected, and Rule 8 remained the proper basis for determining value.

---