2002 (3) TMI 120 - AT - Customs

Tribunal overturns penalty for rough diamonds, emphasizing genuine transaction values & evidence standards.

MAHALAXMI GEMS Versus COMMISSIONER OF CUSTOMS, MUMBAI

The Tribunal allowed the appeal, setting aside the confiscation order and penalty imposed on the importer for rough diamonds. The decision highlighted the ... Valuation (Customs) - Rough diamonds Issues Involved:The acceptability of the value declared for rough diamonds imported, confiscation under clause (m) of Section 111 of the Act, waiver of notice by importer, reduction of value by Commissioner, imposition of penalty.Acceptability of Declared Value:The appeal considered the value declared by the appellant for rough diamonds imported. While one lot's value was accepted, the department deemed the values declared for two other lots excessive, proposing confiscation under clause (m) of Section 111 of the Act. Despite the goods being duty-exempt, the Commissioner reduced the total declared value significantly but allowed export on payment of a specified amount. The basis for the enhanced value was the opinions of appraising officers and members of a trade panel, raising concerns about the panel's composition and impartiality. However, as the declared value was based on genuine invoices without allegations of fabrication or relationships affecting valuation, the Tribunal applied the Supreme Court's judgment to uphold the transaction value unless falling under specific Customs Valuation Rules.Confiscation and Penalty:Ultimately, the Tribunal allowed the appeal, setting aside the order for confiscation of goods and the penalty imposed on the appellant. The decision emphasized the importance of genuine transaction values and the lack of sufficient evidence to reject the declared value in this case.