Customs valuation of imported ball bearings cannot be enhanced solely on circulars or DRI alerts without rejecting transaction value lawfully.

Imported ball bearings could not have their declared transaction value enhanced merely because of a customs circular or DRI alerts. The valuation mechanism under the Customs Act, 1962 and the Customs Valuation Rules required rejection of the transaction value on legally sustainable grounds, supported by reliable evidence, before any substitution was made. Prior assessments or benchmark figures for similar consignments were not enough by themselves to displace the declared value. The enhancement of value was therefore not sustainable on the materials described.

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Issues: Whether the value of imported ball bearings could be enhanced merely on the basis of a customs circular and DRI alerts without rejecting the transaction value in accordance with the Customs Valuation Rules and Section 14 of the Customs Act, 1962.

Analysis: The declared transaction value had been discarded on the strength of a circular prescribing a benchmark value for Chinese-origin ball bearings of unpopular brand. The record did not show any reliable evidence that the goods were liable to be valued at the enhanced rate, and the authorities below proceeded on prior assessments and alerts rather than on the valuation mechanism prescribed by law. The valuation of imported goods could not be substituted merely because similar consignments had earlier been assessed at a higher figure.

Conclusion: The enhancement of value was not sustainable, and the declared value could not be rejected merely on the basis of the circular or DRI alerts.

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