Customs valuation: post-import credit notes do not reduce transaction value when export sale price was fixed at import.

Customs valuation under the 1988 Rules treats assessable value as the transaction value, meaning the price actually paid or payable for goods sold for export to India. A post-import credit note or concession granted by the foreign supplier because of a long-standing business relationship does not alter the original export sale price. The later reduction is therefore not excluded from transaction value, and the assessable value remains based on the contracted price declared and assessed at import.

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Issues: Whether the post-import price reduction granted by the foreign supplier on account of a long-standing business relationship could be excluded from the assessable value for customs valuation purposes.

Analysis: The imported goods had been ordered, shipped, declared, and assessed at the agreed contract price. The later credit note was issued only after import, by way of an exceptional reduction. Under the Customs Valuation (Determination of Price of Imported Goods) Rules, 1988, the assessable value is the transaction value, namely the price actually paid or payable for the goods when sold for export to India. A post-import concession granted out of business relationship does not alter the price at which the goods were sold for export, and the credit represents part of the price actually paid or payable for valuation purposes.

Conclusion: The post-import reduction could not be excluded from transaction value, and the assessable value remained based on the original contracted price.

Final Conclusion: The appeal failed and the customs refund claim was rejected.

Ratio Decidendi: For customs valuation, a post-import concession or credit note does not reduce transaction value where the goods were already sold for export at the original contract price; the assessable value is the price actually paid or payable at the time of export sale.

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