Limitation and penalty in customs demand partly failed as extended period and section 114A penalty were set aside.

Customs duty demand was sustained only for the normal period of limitation, while the extended-period demand was set aside for want of support. The penalty under section 114A was also set aside, reflecting the limited survival of the demand. The matter was remitted for fresh determination of the interest payable on the surviving liability. The appeal was therefore allowed in part.

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Outcome: Appeal allowed in part. The demand for the normal period of limitation was upheld, the demand for the extended period of limitation was set aside, the penalty under section 114A was set aside, and the matter was remitted to determine interest payable.

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