Customs valuation must reflect actual freight incurred; excess duty paid on notional freight was refundable.

Refund of customs duty was held admissible where the importer had paid duty on freight estimated above the amount actually incurred on imports. Customs valuation must reflect the actual freight incurred, and duty collected on freight not in fact incurred constitutes excess duty. On that basis, the refund claim was legally sustainable, the order granting refund was upheld, and the Revenue's challenge failed.

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Issues: Whether refund of customs duty was admissible where duty had been paid on a higher freight amount than the freight actually incurred on the imports.

Analysis: The importer had paid duty by adopting freight higher than the amount actually paid. Duty on imported goods is payable on the basis of the actual freight incurred, and duty collected on freight not in fact incurred is excess duty. On that basis, the refund claim was found to be legally sustainable.

Conclusion: Refund of the excess duty was admissible and the Revenue's challenge failed.

Final Conclusion: The impugned order granting refund was sustained and the Revenue appeal was rejected.

Ratio Decidendi: Customs duty paid on an amount included in valuation but not actually incurred as freight is refundable, since valuation must reflect the actual freight incurred.

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