Customs valuation challenge survives written acceptance where recorded reasons for doubting declared value were not properly communicated.

Customs valuation under Section 14 of the Customs Act, 1962 read with Rule 12(2) of the Customs Valuation Rules, 2007 requires the proper officer to record and communicate reasons for doubting the declared transaction value before rejecting it and reassessing. A written acceptance of enhanced value does not, by itself, extinguish the importer's right to challenge the valuation, especially where the letters show clearance under protest rather than unconditional consent. The later Delhi High Court view noted that written acceptance under Section 17(5) only dispenses with a speaking order; it does not waive the statutory safeguards in Rule 12(2) or bar challenge to the reassessment.

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Issues: Whether the rejection of the appeals on the basis of written acceptance of enhanced value was sustainable, and whether the customs authorities could uphold reassessment without complying with the statutory requirement of recording and communicating reasons for doubting the declared transaction value.

Analysis: The valuation of imported goods is governed by Section 14 of the Customs Act, 1962 read with Rule 12(2) of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007. A proper officer cannot reject the declared transaction value and proceed to reassess merely because the importer signed an acceptance letter, unless the statutory basis for doubting the declared value is recorded and communicated. The letters placed on record showed requests for clearance under protest and did not amount to an unconditional surrender of the importer's right to challenge the reassessment. The later pronouncement of the Delhi High Court confirmed that a written acceptance of reassessment under Section 17(5) only relieves the officer from passing a speaking order; it does not waive the importer's right to question the correctness of the valuation decision or dispense with compliance with Rule 12(2).

Conclusion: The enhancement of value could not be sustained solely on the basis of the acceptance letters, and the rejection of the appeals by the Commissioner (Appeals) was unsustainable. The issue is answered in favour of the assessee.

Ratio Decidendi: Written acceptance of reassessment does not extinguish the importer's statutory right to challenge valuation, and rejection of declared value must be preceded by recorded and communicated reasons showing reasonable doubt under the customs valuation rules.

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