Customs valuation must follow sequential valuation rules before enhancing assessable value; direct reliance on ledger figures was unsustainable.

Customs valuation must follow the sequential methods in the Customs Valuation Rules, 2007, beginning with transaction value and then contemporaneous imports of identical or similar goods before any residual basis is used. An enhancement of assessable value cannot be sustained where customs authorities bypass that structured exercise and rely directly on public ledger figures. Because the prescribed valuation steps were not applied, the valuation determination was unsustainable. The matter was set aside and remanded for fresh assessment under the Rules, with the importer given an opportunity to produce evidence of contemporaneous imports.

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Issues: Whether the enhancement of assessable value of imported goods could be sustained when the customs authorities did not apply the sequential methods prescribed under the Customs Valuation Rules, 2007 and instead relied on public ledger figures.

Analysis: The value of the imported goods was enhanced without first examining the transaction value of contemporaneous imports of identical goods or, failing that, similar goods, and without resorting in sequence to the prescribed valuation methods. The Rules require a structured and sequential exercise for determining assessable value, and a non-prescribed basis such as a public ledger cannot be adopted straightaway. Since that exercise had not been undertaken, the valuation determination was unsustainable. The proper course was to remit the matter for fresh determination in accordance with the Rules, with an opportunity to the importer to produce supporting evidence of contemporaneous imports.

Conclusion: The valuation order was set aside and the matter was remanded to the adjudicating authority for fresh determination under the prescribed valuation rules, in favour of the appellant.

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