Customs valuation requires recorded findings to reject transaction value; misapplied comparable data cannot justify enhancement.

Declared transaction value in customs valuation must be accepted unless the authority records findings showing the special circumstances under the valuation rules that justify rejection under Section 14 of the Customs Act, 1962. A valuation enhancement based on a misapplied contemporaneous comparison, including reliance on a non-comparable import and a proforma invoice from a different stage of the commercial chain, is unsustainable. Where there is no evidence of additional payment over the declared price and the proposal for confiscation and penalty is dropped, the declared assessable value cannot be rejected on the facts found.

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Issues: Whether the declared assessable value of the imported goods could be rejected and enhanced on the basis of the relied-upon import data and proforma invoice.

Analysis: Rejection of the declared value under Section 14 of the Customs Act, 1962 read with the Customs Valuation Rules, 1988 required a finding that the circumstances specified in Rule 4(2) existed so as to displace the transaction value. No such finding was recorded. The enhancement was based on a misreading of the so-called contemporaneous transaction: the Commissioner treated a February 1998 sale as comparable with a November 1997 import and also relied on an October 1997 proforma invoice for a different stage of the commercial chain. The reasoning was inconsistent, and the order also noted that there was no evidence of any payment over and above the declared price, while the proposal for confiscation and penalty was dropped.

Conclusion: The declared value could not be rejected on the facts found, and the valuation enhancement was unsustainable.

Final Conclusion: The valuation order was set aside and the appeal succeeded.

Ratio Decidendi: The declared transaction value must be accepted unless the authority establishes, on recorded findings, the existence of the special circumstances that justify rejection under the valuation rules; a misapplied or non-contemporaneous comparison cannot support enhancement.

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