KARACHI: The Customs Appellate Tribunal Bench-III in Karachi has set aside Valuation Ruling No. 2094/2026 and the Order-in-Revision that modified it.
The judgment, authored by Dr. Tahir Qureshi, Member Technical-I, and signed by Member Judicial-I Mazhar Ali Ghallu, was announced on 12 October 2026 in Customs Appeal No. K-1147/2026, filed by M/s HIM Associates of Lahore.
The ruling fixed customs values for perfumes, eau de toilette and eau de cologne across nine categories, from A+ to H. The Tribunal found that the values, which were roughly 100% to 300% higher than those in the earlier Ruling No. 1840/2024, were not supported by disclosed evidence or reproducible calculations.
Observers described the judgment as notably even-handed. It does not reject the Directorate’s approach outright. Dr. Qureshi accepted that variant-wise categorization can be more accurate than blanket brand-level values, and that retail-market prices can be a legitimate basis for deductive valuation. It also noted that a large increase in value is not unlawful merely because of its size.
The Tribunal drew a clear line between a method being permissible and its application being lawful. It held that the Directorate must disclose its price observations, the criteria for choosing representative prices, the deductions applied and the mathematics behind each category value.
The judgment observed that a revised table cannot be sustained simply because a competent authority issued it, and that a value does not become lawful merely because it is lower than the one it replaces.
The bench also questioned how values for thousands of individual brands were derived, noting the appellant’s claim that over 30% of the listed brands are discontinued or unavailable.
The Director of Customs (Valuation) must undertake a fresh exercise under Section 25A, using the methodology in Section 25, after giving stakeholders a hearing. Until a new ruling is issued, clearance collectorates will assess goods under Section 25.
The appellant was represented by Advocates Shahzad Ali, Mir Meher Dil and Tayyaba, with consultant Faisal Ghani. Their submissions challenged the foundation of the valuation exercise rather than just the quantum of values, including the sequential application of Section 25, the greatest-aggregate-quantity requirement, the undisclosed market inquiry and the unexplained percentile selection. The Tribunal’s findings closely tracked these arguments.
The decision reaffirms that fiscal liability must rest on transparent, verifiable and reasoned determinations, a principle likely to benefit importers and the wider trade community.
