Limitation on customs demand defeated where bona fide classification and declared imports showed no suppression or misdeclaration.

Differential customs duty for the imported Tylosin Phosphate Powder was found barred by limitation because the importer had made the declaration in the bills of entry and held a bona fide belief that the goods were classifiable as poultry feed under Heading 2309. The record did not show mala fide intent, intentional suppression, or misdeclaration to evade CVD, especially since the Department had not changed the classification at assessment. On that basis, the demand could not be sustained on the ground of limitation and failed in favour of the assessee.

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Issues: Whether the demand of differential customs duty for the period 21.06.2000 to 05.07.2005 was barred by limitation in view of the importer's bona fide classification and declaration of Tylosin Phosphate Powder as poultry feed.

Analysis: The imported goods had been declared as Tylosin Phosphate Powder and assessed on the basis of the bills of entry filed by the importer. The earlier classification dispute in a similar matter had supported classification under Heading 2309, and the importer had entertained a bona fide belief that the goods were correctly classifiable under that heading. The record did not establish any mala fide intention to misdeclare the goods or to evade CVD, particularly when the Department had not altered the classification at the time of assessment of the bills of entry. In these circumstances, the demand could not be sustained on the footing of intentional suppression or misdeclaration.

Conclusion: The demand was held to be unsustainable on limitation, and the finding went in favour of the assessee.

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