Extended limitation barred for hard waste duty demand where disclosure was made in approved classification lists.

Extended limitation could not be invoked for duty demand on hard waste cleared at nil rate because the assessee had disclosed that position in approved classification lists. The show cause notice itself recorded that single yarn was captively consumed to manufacture double or multifold yarn and that hard waste arose in that process. In the absence of suppression or misstatement with intent to evade duty, a demand raised beyond the normal period was barred by limitation.

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Issues: Whether the extended period of limitation could be invoked to confirm duty demand on hard waste cleared at nil rate of duty.

Analysis: The assessee had disclosed in the classification lists that hard waste was being cleared at nil rate of duty, and those lists had been approved by the proper officers. The show cause notice itself reflected that single yarn was captively consumed for manufacture of double or multifold yarn and that hard waste arose in that process. On these facts, there was no basis to attribute suppression or misstatement with intent to evade duty. The demand, having been raised beyond the normal period, was therefore hit by limitation.

Conclusion: The extended period of limitation was not invocable, and the duty demand was barred by limitation in favour of the assessee.

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