Transaction value for imported goods must be accepted where a genuine contract price exists and no valuation-disqualifying factors are shown.

Imported silk covered by a genuine contract price could not have its declared transaction value rejected merely because a higher contemporaneous import price existed. In the absence of any finding of related-party dealings or extra-commercial consideration affecting the price, the valuation rules required acceptance of the transaction value. The Tribunal's earlier decision on identical imports, affirmed by the Supreme Court, supported that approach, and the contract value accepted by the importer was the proper assessable value.

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Issues: Whether the declared transaction value of the imported silk was liable to be rejected and replaced by contemporaneous import price for assessment of customs duty.

Analysis: The import was made pursuant to a contract fixing the price, and there was no finding that the buyer and seller were related or that any extra-commercial consideration affected the price. The earlier decision of the Tribunal in the assessee's own case on identical imports had been affirmed by the Supreme Court, and the High Court had also disapproved the view that each Bill of Entry must be treated as a wholly independent cause so as to ignore that binding decision. In these circumstances, the declared value could not be discarded merely because a higher contemporaneous price was available. The enhanced contract value of US $ 13.76 per kg, accepted by the assessee, was the proper assessable value.

Conclusion: The rejection of the declared value was unsustainable, and assessment had to be made on the contract value accepted by the assessee, in favour of the assessee.

Ratio Decidendi: Where imported goods are covered by a genuine contract price and no circumstances exist to reject it under the valuation rules, the transaction value must be accepted and cannot be supplanted merely by contemporaneous import prices.

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