2014 (5) TMI 202 - AT - Customs

Tribunal Upholds Decision on Imported Stones Value Dispute.

The Tribunal upheld the decision of the Commissioner (Appeals) in a case involving the misdeclaration of the value of imported cut and polished stones. ... Value of the cut rebilite and cut emerald – No Evidence of import of sample goods - Can the price of cut rubilite and cut emerald be less than the price of the rough rubilite stone - Held that:- Department has got the value of cut & polished rebilite and cut & polished emeralds ascertained by a Panel of Gems experts - The opinion of the experts panel which has been relied upon by the Department does not mention the quality - It is not known as to whether the rough of rubilite whose declared value is US$ 25 per carat, is of superior grade/quality than the cut & polished rubilite & emeralds - Moreover, there is no evidence of contemporaneous import of identical or similar goods i.e. cut & polished rubilite and emeralds of the same quality in comparable quantity at the prices which are sought to be adopted by the department - There is no justification for rejecting the declaration transaction value and as such there is no infirmity in the impugned order – Decided against Revenue. Issues:Misdeclaration of value of imported goodsAnalysis:The case involved a dispute regarding the declared value of cut and polished precious and semi-precious stones imported by the respondent. The department contended that the declared value of certain stones was deliberately misdeclared to evade duty, as it was significantly lower than the value of rough stones. The department rejected the declared value, assessed the value with the help of gem experts, and enhanced it substantially. Subsequently, the jurisdictional Addl. Commissioner rejected the declared assessable value, enhanced the value of the goods, and ordered confiscation of the cut rubilite and cut emerald for misdeclaration. The Commissioner (Appeals) set aside the Addl. Commissioner's order, citing lack of evidence of contemporaneous import of similar goods to justify the rejection of the declared value. The Revenue appealed against this decision.The Departmental Representative argued that the declared value of cut rubilite and cut emerald was underdeclared to evade duty, as the declared values were much lower than that of rough stones. The Department emphasized that the discrepancy in values indicated misdeclaration to avoid duty payment on cut and polished stones, which attract customs duty unlike rough stones. The Departmental Representative contended that the impugned order was incorrect based on these grounds. On the other hand, the respondent's counsel defended the impugned order by supporting the findings of the Commissioner (Appeals) and highlighting the absence of evidence regarding contemporaneous import of similar goods at the prices adopted by the Department.Upon considering the arguments from both sides and reviewing the records, the Tribunal focused on the dispute concerning the value of the cut rubilite and cut emerald. The Department's assertion that the declared values were incorrect due to being lower than the rough stone's value was challenged. The Tribunal noted that the valuation by gem experts lacked crucial details regarding the quality and grade of the stones, which significantly impact their value. The experts' opinion did not establish whether the rough rubilite was of superior quality compared to the cut and polished stones. Additionally, there was no evidence of contemporaneous import of identical or similar stones in comparable quantity at the prices adopted by the Department. Consequently, the Tribunal found no justification for rejecting the declared transaction value, affirming the decision of the Commissioner (Appeals) and dismissing the Revenue's appeal.