Tribunal rules in favor of appellant, sets aside valuation, and allows re-export of Natural Rough Diamond without penalty

The Tribunal set aside the valuation of Natural Rough Emerald and the redemption fine imposed, finding the Government-approved valuer's assessment acceptable. It also ruled in favor of the appellant regarding the imposition of a redemption fine on Natural Rough Diamond, allowing re-export without penalty due to lack of evidence of deliberate mis-declaration or smuggling. The Tribunal held that no penalty or fine was warranted, ultimately allowing the appeal.

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Issues Involved:
1. Valuation of Natural Rough Emerald and imposition of redemption fine.
2. Imposition of redemption fine on Natural Rough Diamond.

Summary:

Issue 1: Valuation of Natural Rough Emerald and Imposition of Redemption Fine
The Tribunal examined whether the valuation by the Government-approved valuer of Natural Rough Emerald and the consequent imposition of redemption fine was correct. The only reason given for rejecting the declared value was the presence of undeclared Natural Rough Diamonds. The Tribunal noted that the valuer, Shri Kamal Kant Parekh, did not figure in the list of Government-approved valuers as per Public Notice No. 03/2022. The Tribunal found that valuation of precious stones is subjective and generally fluctuates by +/- 20%, and the value declared by the appellant was within this range. The Revenue failed to provide cogent reasons or evidence for rejecting the transaction value. The Tribunal cited precedents, including Bikash Saha Vs. Commissioner of Customs (Prev), Kolkata, and Commissioner of Customs, Calcutta Vs South India Television (P) Ltd., to support its decision. Consequently, the Tribunal held that the Department failed to prove the transaction value was incorrect, and the valuation by the valuer was set aside. The Tribunal also found no grounds for imposing Rs. 50 lakh as redemption fine on the Natural Rough Emerald.

Issue 2: Imposition of Redemption Fine on Natural Rough Diamond
The Tribunal considered whether the imposition of redemption fine on the undeclared Natural Rough Diamonds was correct. The Tribunal noted that the import consignment was opened and examined routinely, and the three packets of Natural Rough Diamond were not concealed. The Director of the appellant company stated that the diamonds were never ordered, and the exporter corroborated this, admitting a mistake in packing. The Tribunal referred to Circular No. 53/2003-Cus, which allows goods without a Kimberley Process Certificate (KP Certificate) to be sent back to the exporting country. The Tribunal found no evidence of deliberate mis-declaration or smuggling by the appellant. Consequently, the Tribunal permitted the re-export of the Natural Rough Diamonds without payment of redemption fine.

Conclusion:
The Tribunal set aside the impugned order, holding that no penalty or fine is leviable on the appellant, and allowed the appeal.

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