Appellate authority cannot enlarge the scope of appeal and decide an unchallenged valuation issue on merits.

An appellate authority must confine itself to the precise ground raised in the appeal and cannot reopen an unchallenged issue on its own merits. Here, the dispute before the Commissioner (Appeals) concerned only the factual basis for rejection of deductive value data under the Customs Valuation Rules, not the prior rejection of transaction value. By holding that transaction value should not have been rejected, the authority went beyond the scope of the Revenue appeal. That finding was set aside, and the matter was remitted for decision only on the specific issue raised.

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Issues: (i) whether the Commissioner (Appeals) could travel beyond the specific challenge raised in the Revenue appeal and re-examine rejection of the transaction value under the Customs Valuation Rules.

Analysis: The order-in-original had proceeded on deductive value method under Rule 3(3)(b) of the Customs Valuation Rules, 2007, and also referred to the corresponding provision under the Customs Valuation Rules, 1988. The appeal before the Commissioner (Appeals) questioned the factual basis and scrutiny applied to the deductive value data, not the prior rejection of transaction value under Rule 3(3)(a). By deciding that the transaction value ought not to have been rejected, the appellate authority addressed a matter outside the dispute carried before it.

Conclusion: The Commissioner (Appeals) exceeded the scope of the appeal and that finding was set aside.

Final Conclusion: The matter was sent back to the Commissioner (Appeals) to decide only the specific issue raised in the appeal.

Ratio Decidendi: An appellate authority must confine itself to the issue actually raised before it and cannot enlarge the dispute to decide an unchallenged ground on merits.

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