FOB Value Agreed Between Buyer and Seller Cannot Be Changed by Customs Authorities: CESTAT

The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has ruled that the FOB (Free On Board) value agreed between buyer and seller cannot be changed by Customs authorities. This significant decision reinforces the principle of contractual sanctity in international trade and valuation for customs duty. CESTAT emphasized that if the FOB value is genuinely declared and reflects the transaction price, customs officials cannot arbitrarily re-determine it without concrete evidence of undervaluation or fraud. This ruling provides predictability and certainty for importers and exporters regarding customs valuation.