Declared export value cannot be rejected without prescribed valuation steps and disclosure of relied-upon material.

Rejection of a declared export transaction value is unsustainable unless the adjudicating authority first follows the prescribed valuation sequence and discloses the relied upon material to the exporter. Here, the value was enhanced on contemporaneous prices without establishing comparable parameters such as quantity and destination, and without showing that the residual method was reached in accordance with the valuation rules. The exporter was also denied the documents and basis used for loading the value, so natural justice was not observed. The enhancement and rejection of the declared value were therefore set aside.

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Issues: Whether the enhancement of the export value and rejection of the declared transaction value were sustainable when the adjudicating authority did not follow the prescribed valuation sequence and did not furnish the relied upon documents to the exporter.

Analysis: The declared export value was enhanced on the basis of contemporaneous prices, but the adjudicating authority did not establish comparable parameters such as quantity and destination, nor did it demonstrate that the valuation had proceeded through the prescribed sequence before resorting to the residual method. The record also showed that the exporter was not given the documents and material relied upon for loading the value, and the appellant was not put on notice of the basis on which rejection of the declared price was proposed. Compliance with the valuation rules and observance of natural justice were therefore lacking.

Conclusion: The enhancement of value and rejection of the declared transaction value were unsustainable, and the appeals were entitled to succeed.

Ratio Decidendi: Rejection of a declared export transaction value must be preceded by adherence to the prescribed valuation sequence and by disclosure of the relied upon material to the affected party; otherwise the enhancement cannot be sustained.

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