Limitation under extended period fails where bona fide exemption belief and no suppression support the demand.

A bona fide belief that the goods conformed to BIS standards and were eligible for exemption, supported by a later BIS certificate for the same product, defeated any inference of suppression or mala fide intent. The notification was treated as not making production of a certificate a precondition for exemption. On those facts, invocation of the extended period was unjustified, and the demand was held to be barred by limitation.

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Issues: Whether the demand was barred by limitation in the facts of the case.

Analysis: The appellant's claim that the goods were manufactured in conformity with BIS standards was supported by the later BIS certificate for the same product. On that basis, the belief that the goods were eligible for exemption was held to be bona fide. The notification was also treated as not requiring production of a certificate as a precondition. In these circumstances, there was no material to infer mala fide intent to evade duty or suppression of facts so as to justify invocation of the extended period.

Conclusion: The demand was held to be hit by limitation and could not be sustained under the extended period.

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