Uninstall rails as:-
gem uninstall railties
Select the option of railties-4.0.3 to uninstall it.
It will uninstall dependencies of rails-4.0.3 and when you check its version.
rails -v
It will show
Rails 3.2.13
After uninstalling rails as gem uninstall rails doesnot uninstall its dependencies. Due to which it shows the rails version as Rails 4.0.3