Delayed show-cause notice after department had full information; extended limitation rejected and demand held time-barred, appeal allowed.

The dominant issue was whether the extended limitation period could be invoked despite the department's knowledge and a nearly two-year delay in issuing the show cause notice. Applying Tribunal precedents holding that undue delay after obtaining information negates the allegation of suppression or misdeclaration, the Tribunal found that where details were promptly furnished and the activity was in the public domain, the subsequent belated notice was fatal to the plea of suppression; accordingly, the demand was held time-barred and the appeal was allowed with consequential relief, without examining the merits on manufacture or duty liability.

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Issues:
The issues involved in the judgment are whether the fabrication activity amounts to manufacture of excisable goods, liability to pay duty, suppression of facts, and the plea of limitation.

Fabrication Activity and Duty Liability:
The appellants were engaged in recommissioning a bridge and provided details of fabrication to the Central Excise department. The department alleged suppression and demanded duty, contending that the goods were excisable and dutiable. The Collector upheld the demand, stating that the appellants failed to declare the manufacturing activity, resulting in misdeclaration and suppression. The appellants argued that fabrication was not manufacturing and the duty liability was on independent subcontractors. The Collector imposed duty and penalty, leading to the appeal.

Plea of Limitation:
The appellants argued that the show cause notice issued after two years from the commencement of the enquiry was not sustainable due to the delay. The Tribunal referred to precedents where delay between department knowledge and notice issuance was fatal to the argument of suppression. Citing cases like J.S.L. Industries Ltd. and Mopeds India Ltd., the Tribunal held that the delay in issuing the notice rendered the plea of limitation valid. As a result, the appeal was allowed on the ground of limitation, without considering the merits of the case.

This judgment by the Appellate Tribunal CEGAT, Mumbai addressed the issues of fabrication activity constituting manufacture of excisable goods, duty liability, suppression of facts, and the plea of limitation. The Tribunal found that the delay in issuing the show cause notice after department knowledge rendered the plea of limitation valid, following precedents and holding in favor of the appellants on this ground.

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