Customs valuation cannot rest on contemporaneous imports alone without lawful rejection of declared value and cogent evidence.

Customs transaction value for imported steel scrap cannot be displaced by contemporaneous import prices unless the declared value is first lawfully rejected on a recorded basis and undervaluation is supported by cogent, comparable evidence. Mere reliance on other imports, without proof of identity, comparability, or any laboratory or sampling support, is insufficient. Payment of duty to avoid detention and demurrage does not amount to acceptance of the enhanced value. CESTAT Chandigarh therefore held the value enhancement unsustainable, set aside the assessment orders, and granted relief to the assessee.

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Issues: Whether the transaction value of imported steel scrap could be rejected and the assessable value enhanced on the basis of contemporaneous imports without cogent evidence of undervaluation and without a lawful rejection of the declared value.

Analysis: The enhancement was based on contemporaneous import prices, but the declared transaction value was not validly rejected under the Customs valuation framework. No samples were drawn, no laboratory report was available, and the record did not show cogent evidence that the declared price was not the actual transaction value. Mere reference to other imports, without establishing identity, comparability, and the factual basis for doubting the declared value, was insufficient. Payment of duty to avoid detention and demurrage did not amount to acceptance of the enhanced value, and the cited precedents did not apply to the facts of the case.

Conclusion: The transaction value could not be rejected on the basis of contemporaneous imports alone, and the enhancement of value was unsustainable. The issue is decided in favour of the assessee.

Final Conclusion: The valuation enhancement failed for want of lawful rejection of the declared price and supporting evidence, so the assessment orders were set aside and relief followed.

Ratio Decidendi: Transaction value under customs valuation cannot be displaced by contemporaneous import prices unless the revenue first records a lawful basis to reject the declared value and substantiates undervaluation with cogent, comparable evidence.

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