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port was made confirming the price declared by exporter indicated in US dollar
that has been converted into Indian rupees and two lines towards the cost
breakup. Not only that the letter also suggested the cost of the export consign-
ment to be extended to Rs. 500/- to Rs. 600/-. It is only after the receipt of this
letter, which clearly indicates that DRI has influenced CLRI to give favourable
report after changing the two initial reports as per their wish. Accordingly, we
find that the report of CLRI is completely influenced by the price suggested by
the DRI and the same cannot be taken as independent and fair evaluation of
price of the export consignment. In any case, we also find that the CLRI is not an
authorized agency to determine the prices of the export consignment, which can
only be arrived in terms of Export Valuation Rule. The Learned Adjudicating
Authority has not followed the Export Valuation Rule while rejecting the transac-
tion value by adopting sequential application of Rules 4 to 6 of the Valuation
Rules. Learned Adjudicating Authority in the impugned order has however held
that in case the export consignment cannot be compared with any other export or
identical or similar goods. It is also held in the impugned order that the goods
already exported were not available for such comparison in view of quality of
leather and various embellishments used in the export consignment. This ap-
pears to be inacceptable in terms of Customs Export Valuation Rule.
15. It is also evident from the record that the letter to CLRI was written
by ADG, DRI suggesting the possible price of export consignment and he also
adjudicated the case as the Commissioner of Customs on the basis of the report
from CLRI which has earlier been influenced by him. In such a circumstance the
impugned order cannot be said to be fair and impartial and in compliance with
the Principle of Natural Justice and therefore liable to be set aside on this ground
alone. We also find that the Learned Adjudicating Authority has not followed the
Customs Valuation Rules, 2007, which is reproduced as under :
“Customs Valuation (Determination of Value of Export Goods) Rules, 2007
[Notification No. 95/2007-Cus. (N.T.), dated 13-9-2007]
1. Short title, commencement and application. - (1) These rules may be
called the Customs Valuation (Determination of Value of Export Goods)
Rules, 2007.
(2) They shall come into force on the 10th day of October, 2007.
(3) They shall apply to the export goods.
2. Definitions. - (1) In these rules, unless the context otherwise requires, -
(a) “goods of like kind and quality” means export goods which are iden-
tical or similar in physical characteristics, quality and reputation as the
goods being valued, and perform the same functions or are commer-
cially interchangeable with the goods being valued, produced by the
same person or a different person; and
(b) “transaction value” means the value of export goods within the mean-
ing of sub-section (1) of Section 14 of the Customs Act, 1962 (52 of
1962).
(2) For the purposes of these rules, persons shall be deemed to be “relat-
ed” only if -
(i) they are officers or directors of one another’s businesses;
(ii) they are legally recognised partners in business;
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