Customs valuation of imported UPS systems requires genuine comparables; different models and expert opinions were insufficient to support undervaluation.

Imported UPS systems cannot be treated as undervalued unless the comparison material shows that the goods are truly identical or similar in model, brand, capacity and technological specifications. Departmental reliance on valuation data, contemporaneous imports of different models, and consultant or user opinions was insufficient where those materials did not establish comparable goods under the Customs Valuation Rules. On that reasoning, the basis for alleging undervaluation failed, and confiscation and penalties could not be sustained.

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Issues: Whether the imported UPS systems could be treated as undervalued on the basis of comparable imports and expert opinions, and whether confiscation and penalties could follow on that basis.

Analysis: The valuation adopted by the Department was based on Directorate of Valuation data, contemporaneous imports of different models, and opinions of consultants and users. The relevant comparison materials did not establish that the imported goods were the same model, brand, capacity, or technologically comparable goods. The concept of similar or identical goods under the Customs Valuation Rules could not be expanded merely because the goods were manufactured by the same manufacturer or because opinions were obtained from experts. In the absence of reliable material proving undervaluation of the imported model, the foundation for confiscation and penalty was not made out.

Conclusion: The allegation of undervaluation failed, and the consequential confiscation and penalties were not sustainable.

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