Declared import value cannot be rejected on suspicion alone; acceptable evidence is needed to prove undervaluation.

Declared import value cannot be rejected unless the department produces acceptable evidence to displace it. In this customs valuation dispute, the invoice price of imported zip fasteners was not shown to be false or suppressed, and the reliance on an unproduced catalogue and market enquiry was held insufficient to establish undervaluation. Contemporaneous import invoices at similar values further weakened the case for enhancement. The declared value therefore stood, and the allegation of undervaluation was not sustained. A dissenting view preferred de novo adjudication to prove the prevailing market price at the time and place of importation.

---

---

Issues: Whether the declared invoice value of the imported zip fasteners could be rejected and the assessable value enhanced on the basis of catalogue price and market enquiry.

Analysis: The evidence relied upon for rejection of the invoice price was found insufficient. The catalogue was not produced for scrutiny, and it was not shown whether trade discount or other reductions were allowed in the quoted price. The market enquiry was not treated as conclusive proof of the ruling market price, especially when the importer produced invoices showing other contemporaneous imports at similar values and there was no finding of suppression or falsity in the documents filed by the importer. On the material on record, undervaluation was not established to the requisite standard.

Conclusion: The declared value could not be displaced and the finding of undervaluation was not sustained, in favour of the assessee.

Concurring/Dissenting Opinion: One Member dissented and held that, on the true construction of Section 14 of the Customs Act, 1962 and the Customs Valuation Rules, 1963, the matter should be remanded for de novo adjudication so that the market price prevailing at the time and place of importation could be properly proved by evidence.

Ratio Decidendi: A declared import value cannot be rejected unless the department adduces acceptable evidence to displace it; suspicion, unsupported market enquiry, or an unproduced catalogue is insufficient to prove undervaluation.

---