Customs valuation must follow import price evidence first; invoice price cannot be rejected without proof that market value is unascertainable.

Assessable value for imported goods under customs valuation must first be based on the price ordinarily charged at the time and place of importation under section 14(a); the valuation rules apply only if that market price is not ascertainable. A bare repetition of the show-cause notice, without enquiry or evaluation of evidence, is insufficient to reject the invoice price. The invoice price could not be discarded merely because the goods were used or because the manufacturer's list price was higher, particularly where the transaction involved a State Government undertaking and no extra remittance was shown. The matter therefore required redetermination under the applicable valuation rules.

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Issues: Whether the assessable value of the imported goods was to be determined under section 14(a) of the Customs Act, 1962 on the invoice price, or under the valuation rules after holding that the market price at the time and place of importation was unascertainable.

Analysis: The respondent had the burden of proving the allegations in the show-cause notice. The adjudication order was found to be a bare reiteration of the notice and reply, without proper enquiry, discussion of evidence, or application of the governing valuation framework. The legal position stated was that under section 14(a) the value for ad valorem duty is the price at which such goods are ordinarily sold or offered for sale at the time and place of importation, and clause (b) applies only where that price is not ascertainable. On the facts, the invoice price could not be rejected merely because the goods were used or because the manufacturer's list price suggested a higher figure. Since the transaction was through a State Government undertaking and there was no evidence of extra remittance, the invoice price remained relevant and the matter required fresh valuation under the applicable rules.

Conclusion: The assessable value could not be finally upheld on the basis of the adjudication order, and the matter had to be redetermined under Rules 4-A and 5 of the Customs Valuation Rules, 1963.

Ratio Decidendi: Where the market price at the time and place of importation is not established, assessable value must be determined under the valuation rules, and a reasoned enquiry cannot be replaced by a mechanical adoption of the manufacturer's list price.

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