Declared import value cannot be enhanced on a retracted statement and undisclosed market enquiry without verifiable valuation evidence.

Declared import value of optical frames cannot be rejected and enhanced merely on a retracted Section 108 statement and an undisclosed market enquiry. Valuation under Rule 7 of the Customs Valuation Rules requires cogent, verifiable evidence, including disclosed enquiry material, a clear working of the enhanced CIF value, and a reliable comparison with identical or similar goods. Where the Revenue withholds the enquiry report and fails to explain why comparable import documents were disregarded, enhancement is not sustainable. On that basis, the declared value was restored and the importer's valuation was upheld.

---

---

Issues: Whether the declared import value of optical frames could be rejected and enhanced on the basis of a retracted statement and an undisclosed market enquiry.

Analysis: The only direct material relied upon for enhancement was a statement recorded from the importing partner under Section 108 of the Customs Act, 1962, which was later retracted. The Revenue did not rest its valuation on that statement alone but proceeded to adopt a fresh value on the basis of a market enquiry, without furnishing the enquiry report, the working of the enhanced CIF value, or any reliable comparison showing that the goods were identical or similar. The reasons for disregarding other import documents showing comparable values were also not explained. In the absence of disclosed evidence and a verifiable basis for rejection of the declared value, enhancement under Rule 7 of the Customs Valuation Rules, 1988 could not be sustained.

Conclusion: The rejection of the declared value and the consequential enhancement were not justified, and the appeal by Revenue failed.

Final Conclusion: The declared import value was restored and the order in favour of the importer was affirmed.

Ratio Decidendi: Import value cannot be enhanced on conjecture or undisclosed market material; rejection of declared value requires cogent, verifiable evidence supporting valuation under the Customs Valuation Rules.

---