Transaction value in customs valuation cannot be rejected without valid grounds; pro rata enhancement was unsustainable.

Transaction value remains the normal basis for customs valuation and may be rejected only on valid grounds. For imported umbrella components, the Revenue failed to establish a reliable basis for discarding the declared value or for applying best judgment valuation under Rule 8 of the Customs (Valuation) Rules, 1988. The pro rata enhancement adopted by the lower authorities was therefore not sustainable, and the declared transaction value could not be rejected on the facts stated.

---

---

Issues: Whether the declared transaction value could be rejected and the value enhanced on a pro rata basis under Rule 8 of the Customs (Valuation) Rules, 1988 for imported component parts of umbrellas.

Analysis: Transaction value is the normal rule for customs valuation and can be discarded only on valid grounds. The Revenue relied on intelligence and on a proportionate valuation of the full set of umbrella components, but did not establish proper grounds for rejecting the declared value. In the absence of reliable basis for adopting best judgment valuation under Rule 8, the pro rata method adopted by the lower authorities was not sustainable.

Conclusion: The declared transaction value could not be rejected on the facts of the case, and the enhancement on pro rata basis under Rule 8 was not justified.

---