2009 (2) TMI 298 - AT - Customs

Exports alleged as not genuine as the same made under Advance Licence to relatives abroad Gold jewellery exported but description gien as scrap by importers abroad - gold jewellery was exported by the respondents, after the same was put to 100% examination by the customs authorities and the examination was conducted by the authorises by requisitioning a representative of local Jewellery Association recognized by the department hence charge that gold jewellery not exported is not sustainable - report received from Consul (Economics), Consulate General of India, Dubai, are unauthenticated documents so there are not reliable - It is to be noted that the relevant documents produced by the respondents to support their case were attested by an officer from Indian Consulate, Dubai, UAE while the very same documents produced by the revenue through Indian Consulate were not attested. Suffice to say, that the documents produced by respondent has more evidentiary value impugned order dropping charges, is sustainable further issue of the revenue is as to whether the Adjudicating Authority was in error to decide the show cause notice when an appeal is pending before the Division Bench of Hon ble High Court of Karnataka - It is undisputed that the exports of the jewellery by the respondents were as per provisions of Export Import Policy. Respondents have obtained licence for value addition of minimum of 7% as per the Policy value addition raised to 15% by policy circulars by DGFT and same challenged in HC by writ petition petition allowed by Single Judge and writ appeal filed by revenue pending in HC stay of single judge order not granted adjudication of SCN not erroneous when stay absent appeal of revenue rejected

Issues Involved:
1. Misdeclaration of exported gold jewellery.
2. Compliance with the Advance Licence scheme and value addition requirements.
3. Legality of the Adjudicating Authority's decision amidst pending judicial proceedings.
4. Evidentiary value of documents submitted by both parties.

Detailed Analysis:

1. Misdeclaration of Exported Gold Jewellery:
The revenue alleged that the respondents misdeclared the exported gold jewellery as "Studded gold jewellery 0.995 fine studded with synthetic/semi-precious stones" while the actual imports at Dubai were declared as "gold scrap." The Adjudicating Authority concluded that the exported jewellery was not misdeclared at the time of export. The jewellery was certified by a Jewellers Association recognized by the department, and no samples were drawn to dispute this certification at the time of export. The Authority relied on the examination and certification of the goods by the Customs and the Jewellers Association, which confirmed the description of the goods as gold jewellery. The Tribunal upheld this finding, noting that the customs authorities had conducted a 100% examination of the exported goods and found no misdeclaration.

2. Compliance with the Advance Licence Scheme and Value Addition Requirements:
The respondents were required to achieve a minimum value addition of 7% as per Paragraph 4.56.1(b) of the Foreign Trade Policy. The revenue argued that the value addition was actually negative when considering locally procured gold. The Adjudicating Authority referred to a judgment by the Karnataka High Court, which held that the respondents were entitled to redemption of the licence upon achieving the required 7% value addition. The Authority noted that the respondents had adhered to the Advance Licence conditions and had exported the jewellery as per the licence requirements. The Tribunal agreed, emphasizing that the respondents had fulfilled their export obligations as per the Foreign Trade Policy and the Adjudicating Authority's decision was in line with the High Court's judgment.

3. Legality of the Adjudicating Authority's Decision Amidst Pending Judicial Proceedings:
The revenue contended that the Adjudicating Authority should have awaited the outcome of the writ appeal pending before the Division Bench of the Karnataka High Court. The Tribunal observed that the High Court's Single Judge's order, which was not stayed, was binding. The Adjudicating Authority was correct in proceeding with the adjudication as the writ appeal did not have a stay order. The Tribunal found no merit in the revenue's argument that the matter should have been transferred to the Call Book pending the High Court's decision.

4. Evidentiary Value of Documents Submitted by Both Parties:
The revenue submitted photocopies of Bills of Entry obtained from the Indian Consulate in Dubai, alleging that the imported goods were declared as "gold scrap." The respondents provided notarized and attested copies of the Bills of Entry, showing the goods as "studded gold jewellery." The Adjudicating Authority found the respondents' documents more credible as they were attested by the Indian Consulate. The Tribunal upheld this finding, stating that unauthenticated documents from the revenue could not be relied upon to establish misdeclaration. The Tribunal emphasized that the respondents' certified documents had more evidentiary value.

Conclusion:
The Tribunal upheld the Adjudicating Authority's order, finding no misdeclaration of the exported gold jewellery, confirming compliance with the Advance Licence scheme, and validating the evidentiary value of the respondents' documents. The appeals filed by the revenue were rejected.

← Previous Next →