Separate corporate identity and limitation bar can defeat exemption denial, demand, and penalty where suppression is unproven.

A separate registered company retains its distinct corporate personality, and the veil cannot be lifted merely because of a change in shareholding; on the facts, the company was not to be treated as a dummy or facade of the holding entity, so exemption could not be denied on that basis. The commentary also notes that a demand and penalty fail where suppression and mens rea are not established, the relevant period is barred by limitation, and the brand name restriction does not apply when the disputed logo is not used on the final products. On those facts, the duty demand and penalty were unsustainable.

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Issues: (i) Whether the appellant could be treated as a dummy or facade of the holding company so as to deny exemption; (ii) Whether the demand and penalty were sustainable in view of limitation, suppression, and the brand name condition under the notifications.

Issue (i): Whether the appellant could be treated as a dummy or facade of the holding company so as to deny exemption.

Analysis: A registered company has a distinct corporate personality, and the corporate veil can be pierced only in special circumstances. The appellant company had existed for decades and its change in shareholding did not by itself justify treating it as a facade of the holding company. The facts did not warrant disregarding the separate legal identity of the appellant.

Conclusion: The appellant could not be treated as a dummy or facade of the holding company, and exemption could not be denied on that basis.

Issue (ii): Whether the demand and penalty were sustainable in view of limitation, suppression, and the brand name condition under the notifications.

Analysis: The demand related to a period prior to incorporation of the appellant in its present form for part of the disputed period, and there was no basis to sustain suppression or mens rea for penalty. The record also did not dispute that the ABB logo was not used on the final products, so the brand name bar could not be invoked. On these facts, the demand was held to be barred by limitation and not sustainable.

Conclusion: The demand was unsustainable, and the penalty was also not maintainable.

Final Conclusion: The appellant succeeded, with the duty demand and penalty set aside on the combined grounds of separate corporate identity, absence of suppression, and non-application of the brand name restriction.

Ratio Decidendi: A separate corporate entity cannot be disregarded merely because of a change in shareholding, and exemption-related demands cannot survive where the evidence does not establish suppression, mens rea, or violation of the brand name condition.

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