CESTAT held demand of duty under Section 28(4) not sustainable for import of inputs used in exempted final products.

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....The case involved a dispute regarding the demand of duty on imported inputs used for final products exempted from duty u/s 3 of N/N. 52/2003-Cus. The Tribunal held that demand u/s 28(4) of Customs Act, 1962 with extended period was not sustainable. The appellant's belief in eligibility for Cenvat credit and favorable Tribunal decisions supported the conclusion. The demand for the extended period was set aside, and only duty for the normal period was upheld. The imposition of penalty u/s 114A was deemed legally unsustainable. The appeal was allowed in favor of the appellant.....