Declared transaction value must be accepted unless valid grounds and comparable similar goods justify rejection under customs valuation rules

Declared transaction value of imported HR coils must ordinarily be accepted under section 14 of the Customs Act, 1962, and rejection is permitted only in the manner contemplated by rule 12 of the Customs Valuation Rules, 2007. A comparison with contemporaneous imports is valid only where identical or similar goods are shown on record to be commercially comparable in a comparable transaction. On the facts, HR steel plates were not shown to be commercially interchangeable with HR coils or to perform the same function, so they could not be treated as similar goods for valuation. No additional consideration beyond the declared price was established, and the proposed enhancement of assessable value was not sustainable.

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Issues: Whether the declared transaction value of imported HR Coils could be rejected and enhanced by comparing it with contemporaneous imports of HR Steel Plates, and whether such goods were similar goods for valuation purposes under the Customs Valuation Rules.

Analysis: Under section 14 of the Customs Act, 1962, the declared transaction value is ordinarily to be accepted, and rejection is permissible only in the manner contemplated by rule 12 of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007. The rule permits doubt to be raised and the declared value to be rejected only where there are valid reasons, including a proper comparison with identical or similar goods imported at or about the same time in a comparable commercial transaction. The record did not show a finding that HR Steel Plates and HR Coils were commercially interchangeable or performed the same function, and no adequate basis was recorded to treat them as similar goods. The Department also failed to establish any additional consideration over and above the declared price.

Conclusion: The declared value could not be rejected on the basis of HR Steel Plates, and the enhancement of assessable value was not sustainable. The appeal filed by Revenue failed.

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