Transaction value governs import valuation where high seas sale price, not earlier contract price, reflects the actual import transaction.

Imported goods are to be valued under Section 14 of the Customs Act by reference to the transaction value, being the price actually paid or payable for goods sold for export to India, adjusted under the Valuation Rules. The earlier 1997 price between the overseas supplier and the first purchaser was not the relevant assessable value because it did not reflect the price at the time and place of importation. The operative import transaction was the high seas sale to the appellant in 1998, so that sale price formed the assessable value.

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Issues: Whether the assessable value of the imported goods had to be taken as the price at which the goods were sold on high seas basis to the appellant in 1998 or the earlier price agreed in 1997 between the original overseas supplier and the first purchaser.

Analysis: The value of imported goods under Section 14(1) of the Customs Act is the price at which such or like goods are ordinarily sold or offered for sale for delivery at the time and place of importation. Section 14(1A) and the Customs Valuation Rules require adoption of the transaction value, namely the price actually paid or payable for the goods when sold for export to India, adjusted as provided in the Rules. The earlier 1997 price could not be treated as the value of the imported goods because it did not reflect the price for delivery at the time and place of importation. The earlier decision relied upon by the appellant was found applicable, and the transaction leading to the import was the high seas sale to the appellant.

Conclusion: The assessable value had to be taken as the high seas sale price paid by the appellant in 1998, and the contrary valuation based on the 1997 price was not sustainable.

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