2007 (5) TMI 439 - AT - Customs

Classification and valuation of marble blocks - Enhancement of value - Marble blocks polished on one side - HELD THAT - The nature of goods under import in the instant bills of entry is the same as the marble blocks covered by our earlier orders. The appellant s claim for classification was also based on the polishing on one side of the marble blocks. In this factual situation, we find no reason to take a different view in the present appeals. The contentions relating to classification are rejected. It is well recognized that quality and price of marble vary vastly depending upon place of occurrence. The Revenue authorities have made comparison of value without taking these aspects into account. The imports were of Monaco Brown , Diano , Mermer Royal Beize etc. The prices are also varying vastly. In fact, the price of Monaco imported by the appellant under Bill of Entry No. 277105 was higher than the contemporaneous import of the same item at Euro 315. The Revenue has accepted that value and rejected all other values. Clearly, the effort is to assess imported goods at the higher end of the value spectrum. This is contrary to market reality as well as Valuation Rule. While market prices vary depending upon myriad factors, Rule 4 of Custom Valuation Rules specifically provides that transaction value should be the basis for the valuation of the consignment under assessment, unless the transaction value is not representing the full price for the reasons mentioned in the Rule itself. Law does not allow a pick and choose approach. Revenue s acceptance of higher prices and rejection of lower prices for assessment is clearly illegal. Thus, we uphold the impugned order in so far as it relates to the question of classification and set aside the order in so far as it relates to valuation. Redemption fine and penalty have been determined taking into account enhanced values. They would require redetermination treating the transaction values of the consignments as the basis. The case is remanded to the adjudicating authority for a fresh determination of redemption fine and penalty. All the appeals are ordered in the above terms.

Summary

Issues involved: Classification and valuation of marble blocks imported by the appellants.

Classification Issue:
The appellant claimed that the marble blocks should be classified under heading 6802 of the Customs Tariff for "Worked monumental or building stone" due to being "polished". However, customs officers found that the polishing was superficial and only on one side, leading to the classification under tariff heading 25 for marble "merely cut into blocks or slabs of a rectangular shape". The Tribunal rejected the appellant's contentions and upheld the classification under heading 25 based on the nature of the marble blocks.

Valuation Issue:
The customs authorities enhanced the value of the consignments based on comparisons with contemporaneous imports, leading to assessable values ranging from 305 to 350 U.S. Dollar per metric ton. The Tribunal found that the enhancement of value was based on some imports relied upon in an earlier order that was set aside. It was noted that the revenue's approach of accepting higher prices and rejecting lower prices for assessment was illegal under the Custom Valuation Rules. The Tribunal upheld the impugned order on classification but set it aside on valuation, remanding the case for a fresh determination of redemption fine and penalty based on transaction values.

Separate Judgment:
The Tribunal highlighted that a similar dispute had arisen in earlier imports of marble blocks, where the classification was confirmed and the enhancement of value was set aside in a previous Final Order. The dismissal of the appeal by the Supreme Court in that case was noted to be on the ground of delay. The Tribunal found no reason to take a different view in the present appeals regarding classification and valuation issues.