Customs valuation and jurisdiction principles: prior assessment stands unless lawfully reviewed, and declared value needs evidence-based rejection.

A preventive customs formation cannot displace an assessment already completed by the competent customs officers for the import, and any fresh confiscation or penalty action on that basis is invalid absent lawful transfer or review. After assessment, where there is no concealment, false declaration, or comparable fraud, the proper course is statutory review under Section 129D rather than a new notice under Section 124. Transaction value under the Customs Valuation Rules, 1988 may be rejected only on legally recognised grounds supported by evidence; mere suspicion, weak comparables, or the importer's consent to enhancement is insufficient. The valuation enhancement, confiscation, redemption fine, and penalties were therefore set aside.

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Issues: (i) Whether the preventive customs authorities could intervene after assessment and clearance by the customs officers having jurisdiction over the airport cargo complex and issue a fresh notice for confiscation and penalty; (ii) whether the show cause notice under Section 124 of the Customs Act was maintainable in the facts of the case or the revenue was required to proceed under Section 129D; (iii) whether the declared transaction value of the imported goods could be rejected and enhanced on the basis of the material relied upon by the revenue.

Issue (i): Whether the preventive customs authorities could intervene after assessment and clearance by the customs officers having jurisdiction over the airport cargo complex and issue a fresh notice for confiscation and penalty.

Analysis: The imported goods had been manifested, a bill of entry had been filed, and valuation had already been examined and assessed by the customs officers exercising jurisdiction over the cargo complex. Though concurrent jurisdiction between customs formations may exist, such jurisdiction cannot be used to displace a valid exercise of jurisdiction already undertaken by the officers competent in respect of the import. A preventive formation cannot snatch a case from the officers of the regular customs house and overrule their action without lawful transfer or review by the proper authority.

Conclusion: The preventive authority's intervention was invalid and the impugned order could not be sustained on that basis.

Issue (ii): Whether the show cause notice under Section 124 of the Customs Act was maintainable in the facts of the case or the revenue was required to proceed under Section 129D.

Analysis: The earlier assessment on valuation had been completed on the basis of the bill of entry and available documents. The facts did not disclose fraud of the kind that would justify bypassing the normal review mechanism. In the absence of concealment, false declaration, or comparable fraudulent conduct, the correct course after assessment was to invoke the statutory review procedure rather than initiate a fresh confiscation proceeding under Section 124.

Conclusion: The notice under Section 124 was not tenable, and the revenue should have proceeded under Section 129D.

Issue (iii): Whether the declared transaction value of the imported goods could be rejected and enhanced on the basis of the material relied upon by the revenue.

Analysis: Under the Customs Valuation Rules, 1988, transaction value is the starting point and can be discarded only when the statutory conditions for rejection are established. The record disclosed no evidence of clandestine remittance, extra consideration, related-party influence, or any other circumstance satisfying the conditions for rejection. The contemporaneous import material relied upon was not shown to relate to identical or similar goods within the statutory sense, and the comparison was weakened by differences in origin and commercial attributes. The declared price therefore could not be displaced merely on a general suspicion of undervaluation or on the basis of the importer's consent to enhancement.

Conclusion: The enhancement of value was unsustainable, and the declared value had to be accepted.

Final Conclusion: The appeals succeeded, the valuation enhancement was set aside, and the consequential confiscation, redemption fine, and penalties were also quashed.

Ratio Decidendi: Once a competent customs authority has validly assessed an imported consignment, a subsequent preventive intervention cannot displace that jurisdiction except through lawful review or transfer, and transaction value under the valuation rules can be rejected only on legally recognized grounds supported by evidence.

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