Declared import value cannot be rejected on surmise without contemporaneous imports or reliable evidence of undervaluation.

Declared import value cannot be rejected on conjecture or theoretical cost-based assumptions. Where ball valves and check valves were re-valued on presumed brass and zinc content, LME prices and a single witness statement, the absence of chemical testing, sample analysis, contemporaneous higher-value imports, or evidence of extra consideration meant the transaction value remained unshaken. Contemporaneous import data produced by the importers was also not addressed. In these circumstances, the rejection of declared value and the resulting demand, confiscation and penalties were held unsustainable.

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Issues: Whether the declared value of the imported ball valves and check valves could be rejected and the goods re-valued on the basis of presumed brass and zinc content, LME prices, and the statement of one witness, without contemporaneous import evidence or chemical testing.

Analysis: The valuation adopted by the adjudicating authority was found to rest on presumption and surmise. No sample was drawn from the imported consignments for testing, and there was no evidentiary basis for the assumed metal composition of the goods. The declared transaction value was rejected without bringing on record contemporaneous imports of higher value, and the contemporaneous import data produced by the importers was not dealt with. The finding of undervaluation was also unsupported by any evidence of extra consideration or other material showing that the declared price was not the actual transaction value. In these circumstances, the rejection of the declared value and the consequent demand, confiscation and penalties could not be sustained.

Conclusion: The declared transaction value could not be rejected on the material available, and the orders confirming undervaluation and differential duty were unsustainable.

Ratio Decidendi: Declared import value cannot be discarded on conjecture or theoretical cost-based assumptions unless the revenue first produces reliable evidence, including contemporaneous imports or other cogent material, to show that the transaction value is not genuine.

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