Custom, Excise & Service Tax Tribunal
M/S R.S.G. Stones vs Cce, Jaipur on 13 May, 2016
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL West Block No. 2, R.K. Puram, New Delhi 110 066. Principal Bench, New Delhi COURT NO. IV DATE OF HEARING : 13/04/2016. DATE OF DECISION : 13/05/2016. Customs Appeal No. 496 of 2011 [Arising out of the Order-in-Appeal No. 14 (DKV) CUS/JPR-I/2011 dated 30/06/2011 passed by The Commissioner of Central Excise & Customs (Appeals), Jaipur.] For Approval and signature : Honble Ms. Archana Wadhwa, Member (Judicial) Honble Shri B. Ravichandran, Member (Technical) 1. Whether Press Reporters may be allowed to see :No the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? 2. Whether it would be released under Rule 27 of : the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? 3. Whether their Lordships wish to see the fair :Seen copy of the order? 4. Whether order is to be circulated to the :Yes Department Authorities? M/s R.S.G. Stones Appellant Versus CCE, Jaipur Respondent
Appearance Shri Rajendra Salcha, Advocate for the appellant.
Shri Ranjan Khanna, Authorized Representative (DR) for the Respondent.
CORAM : Honble Ms. Archana Wadhwa, Member (Judicial) Honble Shri B. Ravichandran, Member (Technical) Final Order No. 51776/2016 Dated : 13/05/2016 Per. Archana Wadhwa :-
As per facts on record, the appellants were given two import licences by Joint Director of Foreign Trade under the EPCG Scheme for import of the machinery. They were under a legal obligation to export Marble Blocks valued of Rs. 2.88 crores approximately against the said licences. After the import of the machinery, they filed shipping bills for export of Marble Blocks to fulfill their export obligation. During the examination of the goods, the Custom officers ICD, Concor, Kankpura where the goods were brought for export entertained a view that the Marble Blocks declared by the appellant are actually not Marble Blocks. Accordingly, the same were allowed to be exported provisionally as free exports.
2. Subsequently, samples were drawn from the said export cargo and were sent to Geological Survey of India, Jaipur to carry different petrology test and to report as to whether samples were of Marble or not. The Director, Geological Survey of India, Jaipur vide his letter dated 10/06/2009 reported that the goods exported by the appellant was Silcified Limestone. Accordingly, the appellant was informed that the provisional assessment is required to be finalized on the basis of test report of the samples received from GSI, Nagpur. It was further observed that in as much as the goods exported by the appellant were Silcified Limestone and as such not covered by the export product of the shipping bills, the shipping bills had not been converted under the EPCG Scheme.
3. Aggrieved with the said letter, the appellant filed an appeal before Commissioner (Appeals). It was contended by the appellant that chemical composition of Marble and Limestone is not different and undisputedly the Marble is formed by the process of metamorphism of Limestone. The Honble Supreme Court in the case of Akbar Badruddin Jiwani vs. Collector of Customs reported as 1990 (47) E.L.T. 161 (S.C.) has observed that marble is formed by metamorphism of limestone and the product should be subjected to microscopic examination to confirm as to whether the same is marble or not. They also contended that the stones under export have been excavated from Marble mines after getting a marble mining lease from the Department of Mines and Geology, Government of Rajasthan. Before mining lease of Marble Mines, the Government has thoroughly surveyed the area for which a marble mining lease is granted. The appellants are paying royalty for dead rent for marble alone which is almost double the rate of royalty charge for Limestone. As such, they contended that in as much as there is no difference in the chemical composition of marble and Limestone, the said fact that the stone was excavated from the Marble Mines under a lease agreement with the Government of Rajasthan has to be given preference. They also relied upon the Tribunal decision in the case of Ramdhan Mohan Lal vs. CCE, Jaipur reported in 2009 (238) E.L.T. 677 (Tri. Del.). The appellants also drew the attention to the procedure for testing and retesting of samples drawn by the Department and by pointing out to various discrepancies, pleaded that the said report, which has been procured at the appellants back, by drawing the samples without associating in the appellant with the sample drawing procedure, is bad and cannot be made applicable.
4. It is seen that Commissioner (Appeals) observed that there are two test reports of the samples, one by the Additional Director, Mines and Geology, Udaipur which found the samples as altered ultra basic (serpentine) rock which is commercially used as Marble, whereas the Director, Geological Survey of India, Jaipur found the said samples Silcified Limestone. He further observed that in as much as the report of the Additional Director, Mines and Geology, Udaipur is not based on chemical analysis and he reported merely on the basis of knowing the product in common trade parlance, the report of the Director, Geological Survey of India, Jaipur, which is based on chemical analysis, is required to be adopted. Accordingly, he rejected the assessees appeal.
5. Hence the present appeal.
6. After hearing both the sides, duly represented by Shri Rajendra Salcha, Advocate the learned Counsel for the appellant and Shri Ranjan Khanna, learned AR for the Revenue, we find that the dispute in the present appeal relates to the nature of the goods exported by the appellant under EPCG Licence Scheme. Whereas the appellants have declared the goods as Marble Blocks, the Revenue has considered the same as Silcified Limestone.
7. As per Wikipedia, Marble is a non-foliated metamorphic rock composed of recrystallized carbonate minerals, most commonly calcite or dolomite. Geologists use the term marble to refer to metamorphosed limestone; however, stonemasons use the term more broadly to encompass unmetamorphosed limestone. Marble is commonly used for sculpture and as a building material. It further says that Marble is a rock resulting from metamorphism of sedimentary carbonate rocks, most commonly limestone or dolomite rock. Metamorphism causes variable recrystallization of the original carbonate mineral gains. The resulting marble rock is typically composed of an interlocking mosaic of carbonate crystals. Primary sedimentary textures and structures of the original carbonate rock (protolith) have typically been modified or destroyed.
As is seen the marble is nothing but a stone which emerges by the metamorphisis of limestone. There is no definition of Marble appearing in the Customs Act and as such we have to resort to the other attending circumstances. The Honble Supreme Court in the case of Akbar Badruddin Jiwani vs. Collector of Customs referred (supra) has referred to the Indian Bureau of Mines letter dated 03/3/1982 wherein it has been mentioned as under :-
Technical Definition :
Geologically (petrologically) marble is recrystallised (metamorphosed) limestone. Ordinary limestone is a sediment tary rock but once it is metamorphosed i.e. once it has undergone recrystallisation, it is turned to marble. So marble is metamorphosed limestone which consist essentially the minerals calcite, dolomite or a combination of the two.
As such, it becomes clear that it is the metamorphosed limestone which turns into marble. As such, the report of the Geological Survey of India, Jaipur laying down that the goods, in question, were Silcified Limestone, actually does not go strictly against the appellant.
8. Apart from that we also note that there is another report of the Additional Director, Mines and Geology, Udaipur, which had opined the goods, in question, were actually marble. The lower Authorities have not given any weightage to the said report on the ground that the same is not based upon the chemical analysis. As already observed even chemical analysis of the other report only leads us to believe that the goods were nothing but metamorphosed limestone.
9. Apart from above, we find that the goods, in question, were being excavated by them under a licence mining lease executed by them with the State of Rajasthan through Mining Engineer, Mining and Geological Department, Bikaner. The dead rent paid by the appellant was at the rate applicable to mines of marble, as against the rate applicable in respect of mines of limestone. The appellants have also realized the entire export value by treating the goods as marbles by their customers. The appellants have also placed on record the assessment order of Government of Rajasthan relating to the pertaining period showing that excavated material was nothing but marble. They have also drawn our attention to the Pollution Control consent given by Rajasthan State Pollution Control Board, Jaipur, a statutory body, for mining of marble in respect of leases. All the attending circumstances lead us to believe that the goods, in question, were marble and not limestone.
10. We also note that the appellants reliance on the Tribunal decision in the case of Ramdhan Mohan Lal vs. CCE, Jaipur reported in 2009 (238) E.L.T. 677 (Tri. Del.) is appropriate. While taking note of two divergent reports of CRCL and Director, Geological Survey of India, Jaipur, the Tribunal observed that the chemical composition of limestone and marble are same and are not different. The marble is formed by the process of metamorphism of limestone. In as much as CRCL report satisfied the physical characteristics of marble, the Tribunal observed that Geological Survey of India report would not be applicable. In the present case, we note that the Geological Survey of India report reflects upon the goods to be limestone, which is nothing but marble. The said report is not available on record in as much as the same was not handed over to the assessee. We are not aware as to what were the questions put to Geological Survey of India at the time of sending all the samples. There being admittedly another report on record holding the goods to be marble and GSIs report not clearly saying that the goods were not marble, we are of the view that the goods have to be held as marble.
11. In view of the foregoing discussion, we find no merits the Revenues stand. Accordingly the impugned order is set aside and the appeal is allowed with the consequential relief to the appellant.
(Order pronounced in the open court on 13/05/2016.) (Archana Wadhwa) Member (Judicial) (B. Ravichandran) Member (Technical) PK ??
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