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Issues: Whether the extended period of limitation under Section 28 of the Customs Act could be invoked against transferees of DEPB licences allegedly obtained fraudulently by the transferor, and whether the resultant duty demand was time-barred.
Analysis: The appeals concerned imports made by transferees under DEPB licences that were alleged to have been fraudulently obtained by the exporter. The impugned orders had already held that there was no finding of collusion, wilful misstatement, suppression of facts, or mala fide conduct on the part of the transferees. In such circumstances, the extended limitation period under the proviso to Section 28 was not available. The decision relied on the principle that where the transferee was not a party to the fraud and the demand was issued beyond the normal limitation period, the demand could not be sustained on limitation.
Conclusion: The extended period of limitation was not invocable against the transferees, and the duty demand was barred by limitation.
Final Conclusion: The impugned orders were upheld and the Revenue's appeals failed, leaving the limitation-based rejection of the duty demands intact.
Ratio Decidendi: The extended period under Section 28 of the Customs Act cannot be invoked against a transferee of a DEPB licence in the absence of collusion, wilful misstatement, suppression of facts, or other culpable conduct attributable to the transferee.
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