Customs valuation requires a reasoned rejection of declared transaction value before enhancement; unsupported remand proceedings were quashed.

Customs valuation cannot proceed on an enhanced declared value unless the proper officer first rejects the transaction value by a reasoned order after inquiry and follows the prescribed valuation procedure. Where the record does not show compliance with that statutory precondition, repeated remand proceedings lack legal foundation and only prolong litigation. The Commissioner (Appeals)' remand order was therefore set aside, and the subsequent proceedings were quashed with consequential relief.

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Issues: Whether the remand order and the subsequent proceedings were sustainable when the proper officer did not pass a rejection order under Section 17(5) of the Customs Act, 1962 and did not follow the procedure under the Customs Valuation Rules, 2007 before enhancing the declared value.

Analysis: The appeal arose from repeated remands in which the declared transaction value had been enhanced without a proper order rejecting that value on the basis of inquiry and without recording the reasons required for discarding the importer's declared value. The record did not show compliance with the statutory requirement to first reject the transaction value by a reasoned order before proceeding to re-determination under the valuation rules. In the absence of such compliance, the remand order only prolonged avoidable litigation and the ensuing proceedings lacked the necessary legal foundation.

Conclusion: The challenge succeeded. The remand order passed by the Commissioner (Appeals) was set aside and the proceedings were quashed with consequential relief to the appellant.

Ratio Decidendi: In customs valuation, the declared transaction value cannot be displaced unless it is first rejected by a reasoned order after inquiry in accordance with the statutory procedure; a valuation enhancement made without such rejection is unsustainable.

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