Transaction value under customs law cannot be rejected without a legally sustainable basis to doubt its accuracy.

Transaction value of imported goods cannot be rejected unless customs has a legally sustainable basis to doubt its truth or accuracy. A test report describing the goods as PVC coated fabrics did not establish mis-declaration, the absence of the manufacturer's invoice was not enough to displace the declared value, and alert circulars with NIDB data did not, on these facts, justify re-determination. The alternative valuation method also had to follow the prescribed contemporaneous-imports scheme, and selective reliance on representative values was inconsistent with that method. The rejection of transaction value, related duty demand, confiscation, redemption fine and penalty were therefore unsustainable.

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Issues: Whether the declared transaction value of the imported goods could be rejected and re-determined under the Customs Valuation Rules, and whether the consequential demand of duty, confiscation, redemption fine and penalty could be sustained.

Analysis: The imported goods were described as PVC coated fabrics, and the test report only added further particulars about the fabric composition and texture. That description did not establish any mis-declaration sufficient to displace the declared value. The absence of the manufacturer's invoice was not a valid basis to reject transaction value because an importer is ordinarily expected to possess only the invoice from his seller. The reliance placed on alert circulars and NIDB data did not, on these facts, create a reasonable doubt about the truth or accuracy of the declared value. The re-determination also did not conform to the valuation scheme, as the adoption of representative values by ignoring outliers was inconsistent with the required method of determining value from contemporaneous imports.

Conclusion: The rejection of transaction value and re-determination of assessable value were unsustainable, and the connected demand of duty, confiscation, redemption fine and penalty also could not stand.

Final Conclusion: The appeal succeeded and the impugned order was set aside with consequential relief.

Ratio Decidendi: Transaction value cannot be rejected in the absence of a legally sustainable basis to doubt its truth or accuracy, and valuation must be re-determined strictly in accordance with the prescribed rules governing contemporaneous imports.

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