Customs Act: Duty demands barred by limitation under Section 28. Tribunal rules in favor of appellants.

The Tribunal ruled in favor of the appellant, finding that the demands for duty payment were barred by limitation as they were raised beyond the six-month period stipulated under the pre-amendment provisions of Section 28 of the Customs Act. Consequently, the impugned orders were set aside, and the appeals were allowed with consequential relief granted to the appellants.

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Issues:
1. Correct classification of imported products under Customs Tariff Heading.
2. Applicability of the period of limitation for issuing show cause notices under Section 28 of the Customs Act.

Detailed Analysis:
1. The appellant imported products classified under Customs Tariff Heading 9018 90 19 but Revenue contended that correct classification should be under Customs Tariff Heading 9027 80 90, attracting higher duty rates. Show cause notices were issued proposing a change in classification and confirmation of duty demands. The appellant did not contest the classification but argued that the demand was beyond the normal limitation period of six months. Revenue argued that the period of limitation was extended to one year post-amendment of Section 28 of the Customs Act.

2. The key issue was whether the period of six months, applicable before 8-4-2011, or the extended period of one year post-amendment of Section 28 would govern the present case. The Explanation 2 to Section 28(10) of the Customs Act clarified that any non-levy, short-levy, or erroneous refund before the Finance Bill, 2011 received the President's assent would be governed by the pre-amendment provisions of Section 28. The Tribunal found the language of the Explanation unambiguous, stating that demands arising before the amendment would be governed by the earlier Section 28 with a six-month limitation. As the demands in the present case were raised beyond six months, the Tribunal held them to be barred by limitation.

In conclusion, the Tribunal set aside the impugned orders, allowing the appeals with consequential relief to the appellants. The stay petition and appeals were disposed of accordingly.

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