Time-barred duty demand and penalties on cleared consignments set aside; seized consignment remitted for fresh adjudication.

Eight consignments cleared under a DFRC licence were held not to involve misdeclaration because the goods were declared as glazed glass, supported by manufacturer invoices, and examined by Customs before clearance; the subsequent duty demand and penalties were therefore set aside as time barred and unjustified. For the seized consignment, the Tribunal found that the issues on merits and limitation required reconsideration and remitted the matter to the Commissioner for fresh adjudication after hearing both sides.

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Issues: Whether the demand of duty and the penalties in respect of the eight consignments cleared without dispute were barred by limitation, and whether the seized consignment required fresh adjudication.

Analysis: The goods in respect of the eight consignments had been declared as glazed glass, supported by the manufacturer's invoices, and had been examined by the Customs officers before clearance under the DFRC licence. In those circumstances, no misdeclaration was made out for those consignments. As the department had accepted the goods and the licence at the time of clearance, the subsequent demand could not be sustained on limitation. The Tribunal also treated the matter as one involving interpretation of the policy provisions and held that the penalties were not justified. As regards the seized consignment, the Tribunal found that the issues on merits and limitation required reconsideration by the Commissioner after hearing both sides.

Conclusion: The demand and penalties relating to the eight consignments were set aside as time barred, while the seized consignment was remitted for fresh consideration.

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