Undervaluation not proved where goods had different specifications and no extra consideration was shown.

Undervaluation of sub-assemblies was not established where the department relied on a highest-price comparison but the invoices showed different specifications and material variations in the goods cleared. In the absence of evidence that the appellant received any extra consideration beyond the recorded sale price, the department failed to prove that the clearances were of identical goods or that the declared value was incorrect. The demand for differential duty, with penalty and interest, could not be sustained.

---

---

Issues: Whether the department had established undervaluation of the sub-assemblies so as to sustain the demand of differential duty, penalty and interest.

Analysis: The demand was based on the premise that all machines supplied by the appellant were identical and could be valued by adopting the highest price charged to one buyer for all clearances. The sample invoices showed that the machines had different specifications and material variations. There was also no evidence that the appellant had recovered any extra consideration beyond the recorded sale price. On these facts, the department failed to prove that the clearances were of the same goods or that undervaluation had occurred.

Conclusion: The allegation of undervaluation was not proved and the demand of duty, penalty and interest could not be sustained. The appellant succeeded on this issue.

---