Customs valuation accepts a genuine re-negotiated forward-contract price where payment matches and no sham is shown.

A genuine re-negotiated price under a recognised forward contract in metals may be accepted as the transaction value for customs valuation where the evidence shows actual remittance of the final invoice amount and no material indicates additional consideration, fraud, or a special understanding. The fact that the price was finalised after arrival does not by itself justify rejection of the declared value under the Customs Act and the Customs Valuation Rules. A lower price also cannot be disregarded merely because it is below an assumed benchmark, especially where the goods are different from those used for comparison and no contemporaneous comparable import price is shown.

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Issues: Whether the imported goods were liable to be valued on the basis of the final invoice under a re-negotiated forward contract, and whether the declared transaction value could be rejected under Section 14 of the Customs Act, 1962 read with the Customs Valuation Rules, 1988.

Analysis: The contract was a recognised forward contract in metals and the record showed that the importer was compelled to re-negotiate only because the Custom House did not accept the provisional invoice and forward contract for clearance. The evidence showed that the amount finally remitted matched the final invoice and there was no material to show that any additional consideration was paid or that the re-negotiated price was a sham. The fact that the price was finalised after arrival did not, by itself, establish suppression or a special understanding. The reason given for reducing the discount was also found unsustainable because the goods imported were copper anodes and not copper scrap, and no contemporaneous higher import price of comparable goods was shown.

Conclusion: The declared transaction value based on the final invoice was accepted and could not be rejected under Rule 4 of the Customs Valuation Rules, 1988; the Revenue's challenge failed.

Ratio Decidendi: A genuine re-negotiated price under a forward contract, supported by proof of actual remittance and untainted by evidence of fraud or special understanding, cannot be rejected merely because the invoice was finalised after import or because it is lower than an assumed benchmark price.

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