Customs valuation burden of proof stays on Revenue; declared transaction value cannot be rejected on suspicion alone.

In customs valuation disputes, the Revenue must prove under-valuation with cogent evidence before rejecting the declared transaction value and resorting to Rule 8 valuation. Mere suspicion, however strong, is insufficient, and in the absence of contemporaneous imports at higher values the declared value cannot be displaced. The record contained no such evidence, so the valuation challenge failed and the assessee's declared value was upheld.

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Issues: Whether the Revenue had discharged the burden of proving under-valuation so as to justify rejection of the declared transaction value and assessment under Rule 8 of the Customs Valuation Rules, 1988.

Analysis: The declared value was displaced only if the Revenue produced cogent evidence of under-valuation. The record did not contain evidence of contemporaneous imports at higher values. Mere suspicion, even if strong, could not substitute for proof. The burden of establishing under-valuation remained on the Revenue, and the absence of such evidence meant the Commissioner (Appeals) was justified in setting aside the valuation dispute.

Conclusion: The Revenue failed to prove under-valuation, and the declared value could not be rejected. The appeal was therefore decided in favour of the assessee.

Ratio Decidendi: In customs valuation disputes, the burden to prove under-valuation lies on the Revenue, and absent cogent evidence such as contemporaneous higher-value imports, the declared transaction value cannot be displaced on suspicion alone.

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