Customs valuation can be rejected where objective material casts doubt on declared import value and alternative methods apply

Declared customs value may be rejected under the Customs Valuation Rules, 1988 when contemporaneous import data and the supplier's own published price provide objective reasons to doubt its truth or accuracy. Once such doubt arises, the transaction value method can be discarded and valuation must proceed through the alternative methods prescribed in the Rules, including best judgment valuation where appropriate. Comparisons based on a different product size were not accepted, and an unverified later certificate was given no weight. The Department's re-determined valuation was sustained and the challenge to the assessment failed.

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Issues: Whether the declared transaction value of imported goods could be rejected under the Customs Valuation Rules, 1988 and whether the re-determined value was sustainable.

Analysis: The declared import value was found to be abnormally low when compared with contemporaneous imports and the supplier's own website price, which furnished sufficient reason to doubt the truth and accuracy of the declared value under Rule 10A. Once such doubt arose, the transaction value method could be discarded and valuation was required to proceed under the alternative methods prescribed in the Rules. The Department adopted the best judgment method under Rule 8 and supported the valuation by reference to comparable market material. Objections based on comparison with a different product size and on a later chartered accountant's certificate were not accepted, as the size-wise pricing disparity was not established and the certificate had not been verified before the lower authorities.

Conclusion: The rejection of the declared value and the valuation adopted by the Department were upheld, and the challenge to the assessment failed.

Final Conclusion: The appeal was rejected and the impugned valuation order was sustained.

Ratio Decidendi: A declared customs value may be rejected when objective material gives reason to doubt its truth or accuracy, and valuation may then be determined under the alternative methods prescribed by the Customs Valuation Rules, 1988.

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