Customs valuation under comparable goods rules allowed resort to export price basis when domestic comparison was unsuitable.

Section 14(1)(b) of the Customs Act permits customs valuation under the prescribed rules, and Rule 3(b) applies only when value cannot be determined under Rule 3(a). Rule 3(a) is confined to comparable goods produced or manufactured and ordinarily sold in India under competitive conditions; where the nature of the goods and the importer's failure to furnish a relevant price list make that method unsuitable, resort to Rule 3(b) is proper. The Tribunal accepted reliance on the manufacturer's price list rather than an unexplained trading-company source, and the valuation order was found to disclose no error of law.

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Issues: Whether the Tribunal was justified in upholding valuation of the imported goods under Rule 3(b) of the Customs Valuation Rules after holding that valuation could not be determined under Rule 3(a).

Analysis: Section 14(1)(b) of the Customs Act permits determination of the value of imported goods in accordance with the prescribed rules. Rule 3(a) applies where comparable goods produced or manufactured and ordinarily sold in India under competitive conditions are available. Rule 3(b) is attracted only when valuation cannot be determined under Rule 3(a), in which event export prices of such goods or comparable goods sold under competitive conditions outside India may be used. On the facts, the authorities found that the nature of the goods and the importer's inability to furnish the relevant price list made valuation under Rule 3(a) unsuitable. The Tribunal also accepted reliance on the manufacturer's price list rather than the trading company's unexplained source.

Conclusion: The invocation of Rule 3(b) was and the valuation order disclosed no error of law; the appeal failed.

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