Declared import value cannot be rejected without reliable comparable evidence; retracted admissions and unverified data are insufficient.

Declared import value cannot be rejected unless the revenue proves undervaluation with reliable, comparable evidence showing that the transaction value is not the real value. A retracted admission made on the basis of pressure or duress is insufficient by itself, and third-party import data must establish identity or similarity of goods, same supplier, and contemporaneous commercial comparability. Where those foundational facts are not proved, the burden on the revenue remains undischarged and the allegation of undervaluation fails, with consequential confiscation, duty demand, interest, and penalties also not sustainable.

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Issues: Whether the declared value of the imported PVC flex sheets could be rejected on the basis of the department's evidence and the retracted letter of admission, and whether the allegation of undervaluation was sustainable.

Analysis: The department relied on a letter dated 15.02.2008 said to contain an admission of undervaluation, but that letter was retracted within a few days on the ground of pressure and duress. Such a retracted statement could not, by itself, sustain the charge of undervaluation. The department also relied on test results and on import data obtained from searches at the premises of other importers. However, the evidence did not establish that the supplier was the same, that the goods were identical or similar, or that the comparative imports were contemporaneous and commercially comparable. The valuation exercise was therefore based on assumptions rather than proven comparables, and the burden of proving undervaluation, which lay on the revenue, was not discharged.

Conclusion: The rejection of the declared value was unsustainable, the charge of undervaluation failed, and the consequential confiscation, differential duty, interest, and penalties could not be sustained.

Final Conclusion: The appeal succeeded, and the impugned findings on valuation and consequential duty and penal liability were set aside in favour of the appellant.

Ratio Decidendi: Declared import value cannot be rejected unless the revenue proves, with reliable and comparable evidence, that the apparent transaction value is not the real value; a retracted statement under duress and unverified third-party import data are insufficient to discharge that burden.

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