Customs valuation rules require statutory method and proof; arbitrary 30% loading on declared value was unsustainable.

Declared transaction value cannot be rejected by comparing an importer's domestic selling price with a related supplier's price in India, because that comparison is not contemplated under the customs valuation rules. The adjudicating authority must follow the statutory hierarchy of valuation methods, rely on contemporaneous imports of identical goods where required, and quantify any alleged transport, storage, value-addition, sales or other permissible adjustments. A flat 30% loading without such basis is arbitrary and unsustainable. The declared value was therefore held to meet the requirements of the Customs Act and valuation framework, and the assessee's valuation was accepted.

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Issues: Whether rejection of the declared transaction value and loading of 30% under the customs valuation rules was justified.

Analysis: The appellate authority found that the declared price could not be rejected on the basis of a comparison between the importer's domestic selling price and the related supplier's price in India, as such a comparison was not contemplated by the valuation rules. It further found that the adjudicating authority had not followed the statutory sequence of valuation methods, had not relied on contemporaneous imports of identical goods, and had not quantified the alleged expenditure on transportation, storage, value addition, sales expenses, or permissible adjustments. The loading of 30% was held to be arbitrary and unsupported by law, and the declared value was held to satisfy the requirements for acceptance under the valuation framework and Section 14 of the Customs Act.

Conclusion: The rejection of the declared value and the 30% loading were held to be unsustainable, and the valuation adopted by the assessee was accepted.

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