Customs valuation requires evidence of price influence; alleged buyer-seller relationship alone cannot justify rejecting declared value.

Transaction value under customs valuation cannot be rejected merely because the buyer and seller are alleged to be related; the revenue must show with evidence that the relationship influenced the price or that the declared value is otherwise untrue. On the facts discussed, the declared import value of urea was accepted because no material established suppression or price influence, making revaluation unsustainable. The extended limitation period also cannot be invoked without material showing suppression, misdeclaration, or similar circumstances justifying larger-period demand; absent such foundation, the demand is time-barred.

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Issues: (i) Whether the declared value of imported urea could be rejected and the goods revalued on the basis of alleged relationship between the buyer and seller and alleged undervaluation. (ii) Whether the demand and consequential proceedings were barred by limitation.

Issue (i): Whether the declared value of imported urea could be rejected and the goods revalued on the basis of alleged relationship between the buyer and seller and alleged undervaluation.

Analysis: The imported goods were assessed on the basis of the declared transaction value under a long-term off-take arrangement. The adjudicating authority had examined the agreements and the documentary record and found that the buyer-seller relationship, by itself, did not establish influence on price. The revenue did not place material to show that the declared price was not the price actually paid or payable or that the value was suppressed. In the absence of evidence showing that the relationship influenced the price, rejection of transaction value and redetermination under the valuation rules was not justified.

Conclusion: The declared value could not be rejected and the revaluation proposal was unsustainable.

Issue (ii): Whether the demand and consequential proceedings were barred by limitation.

Analysis: The adjudicating authority had found no basis for invoking the extended period, and the record before the Tribunal disclosed no material supporting suppression, misdeclaration, or any other circumstance necessary to justify the larger period. The notice therefore lacked sufficient foundation for time-bar avoidance.

Conclusion: The demand was barred by limitation.

Final Conclusion: The appeal failed, the findings of the adjudicating authority were upheld, and the revenue's challenge to the acceptance of the declared import value was rejected.

Ratio Decidendi: Transaction value under customs valuation cannot be discarded merely on an asserted relationship between buyer and seller unless the revenue establishes, with evidence, that the relationship influenced the price or that the declared value is otherwise untrue, and the extended period cannot be invoked without material showing the requisite suppression or misdeclaration.

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