Plain-language reading of customs exemption entries governs classification; unsustainable valuation based on weak comparables was remitted.

A customs exemption entry was construed according to its plain language, and cups of roller bearings imported separately were held to fall within the specific entry for cups and cones of roller bearings rather than the residuary entry. The Tribunal's narrower reading was rejected. On valuation, rejection of the transaction value was accepted as justified, but the Collector's comparative method was found unsustainable because the links used between unbranded and branded goods, and between goods of different origins, were not sufficiently proximate or defensible. The valuation was therefore set aside and the matter remitted for fresh assessment.

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Issues: (i) Whether cups imported separately from roller bearings were classifiable under Sl. No. 6(a) of Notification No. 70/89 or under the residuary Sl. No. 6(c). (ii) Whether the assessable value fixed by the Collector could be sustained or required fresh determination.

Issue (i): Whether cups imported separately from roller bearings were classifiable under Sl. No. 6(a) of Notification No. 70/89 or under the residuary Sl. No. 6(c).

Analysis: The notification was to be read according to its plain language. Sl. No. 6(a) covered cups of roller bearings and cones of roller bearings at the rate applicable to the bearings of which they were parts. There was no warrant for treating the expression conjunctively so as to confine the benefit to cups and cones imported together. The Tribunal had misdirected itself in treating separately imported cups as falling under the residuary entry.

Conclusion: The goods fell under Sl. No. 6(a) of Notification No. 70/89, not under Sl. No. 6(c), and this issue was decided in favour of Revenue.

Issue (ii): Whether the assessable value fixed by the Collector could be sustained or required fresh determination.

Analysis: The transaction value was rightly rejected as unrealistic, but the method adopted to determine value was tenuous and could not be upheld. The linkage used for comparing unbranded goods with branded goods and goods of different origins had to be appreciable and proximate. The proper course was to permit both sides to place material before the Collector for a fresh valuation.

Conclusion: The valuation was set aside and the matter was remitted for fresh assessment of value.

Final Conclusion: The exemption classification was held against the importer, while the valuation exercise was reopened for reconsideration by the assessing authority.

Ratio Decidendi: An exemption entry must be construed according to its plain and ordinary meaning, and valuation based on rejected transaction value must rest on a proximate and defensible comparative basis; if the original valuation method is unsustainable, the matter may be remitted for fresh assessment.

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