Declared transaction value in customs assessment must stand unless the Department proves a statutory basis with cogent supporting material.

Declared transaction value of imported goods must be accepted as the normal basis of customs assessment unless the Department, on cogent material, shows a statutory ground to reject it under the valuation rules. Under section 14 of the Customs Act, departure from invoice price requires reasons and supporting evidence, such as contemporaneous imports or other proof that the declared price was not the sole consideration or was otherwise unreliable. Mere suspicion or an unexplained rejection of the evidence is insufficient. On the stated facts, the assessing authority had not applied the required valuation exercise, so the enhanced assessable value was unsustainable and the declared value was restored.

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Issues: Whether the declared transaction value of imported goods could be rejected and the assessable value enhanced without cogent reasons and supporting material showing that the declared price was not the sole consideration or that Rule 4(2) conditions were attracted.

Analysis: Section 14 of the Customs Act, 1962 embodies the normal rule that customs duty is to be assessed on the price actually paid or payable for the particular transaction. The Customs Valuation Rules, 1988 permit departure from the declared transaction value only in the specified exceptions, and the Department must disclose reasons and support them with material such as contemporaneous imports of identical or similar goods or other evidence showing undervaluation or that the declared price is not the sole consideration. Mere suspicion, or a failure to examine the evidence in a legally relevant manner, is insufficient to discard the invoice price. On the facts, the assessing authority had not undertaken the required exercise, and the Tribunal had correctly applied the settled valuation principles.

Conclusion: The declared transaction value could not be rejected on the material before the authorities, and the enhancement of assessable value was rightly set aside.

Final Conclusion: The appeals failed and the assessee's declared value was restored, leaving the departmental enhancement unsustainable.

Ratio Decidendi: In customs valuation, the declared transaction value must be accepted unless the Department, on cogent material, establishes a statutory basis to reject it under the valuation rules.

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