Customs valuation permits rejection of abnormally low transaction values, but original assessed value cannot be enhanced without authority.

Contemporaneous import data may justify rejection of a declared transaction value where the invoice price is shown to be abnormally low compared with comparable imports. Here, the declared values were only a fraction of contemporaneous import prices, and the discount supported rejection of the invoice value under Rule 4(2) of the Customs Valuation Rules, 1988. However, an assessable value already fixed in the original assessment for one bill of entry could not be enhanced further on the same facts, and the original assessed value was restored for that bill. Revised values based on contemporaneous data were sustained for the remaining bills of entry.

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Issues: (i) Whether the declared transaction value of the imported goods could be rejected on the basis of contemporaneous import data and the substantial discount shown by the declared price; (ii) Whether the assessable value in respect of one bill of entry could be enhanced beyond the value fixed in the original assessment.

Issue (i): Whether the declared transaction value of the imported goods could be rejected on the basis of contemporaneous import data and the substantial discount shown by the declared price.

Analysis: Rule 4(2) of the Customs Valuation Rules, 1988 permits rejection of the declared transaction value where the surrounding circumstances show an abnormal departure from ordinary competitive price. The declared values were only a fraction of the contemporaneous import values, showing a discount of nearly 70% against comparable imports. In such circumstances, reliance on contemporaneous import data was held to justify rejection of the invoice value.

Conclusion: The rejection of the declared transaction value was upheld.

Issue (ii): Whether the assessable value in respect of one bill of entry could be enhanced beyond the value fixed in the original assessment.

Analysis: The value for one bill of entry had already been fixed at a lower figure in the original assessment by the proper officer. The subsequent enhancement to a higher figure was not found permissible on the facts, and the original assessed value was restored for that bill of entry. For the other bills of entry, the revision based on contemporaneous import data was sustained.

Conclusion: The enhancement beyond the original assessment for one bill of entry was set aside, while the revised values for the other bills of entry were upheld.

Final Conclusion: The appeal succeeded only in part. The declared value was rejected, but one enhanced assessable value was reduced to the original assessment level.

Ratio Decidendi: Under Rule 4(2) of the Customs Valuation Rules, 1988, a declared transaction value may be rejected when contemporaneous import evidence shows an abnormally low price, but an assessable value already fixed in the original assessment cannot be further enhanced without lawful authority.

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