Extended limitation cannot rest on alleged suppression where earlier notice had already disclosed the manufacturing activity.

The demand was treated as time-barred because the Revenue could not invoke the extended period of limitation on the basis of misdeclaration or suppression of facts. An earlier show cause notice on the same grounds had already brought the activity and manufacturing process to the Revenue's notice, so the assessee's conduct could not again be characterised as concealed or suppressed for limitation purposes. The demand was therefore examined only on limitation and not on the merits, and the extended period failed in favour of the assessee.

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Issues: Whether the demand was barred by limitation and the extended period of limitation could be invoked on the allegation of misdeclaration and suppression of facts.

Analysis: The goods were the same as those covered by an earlier show cause notice issued on the same grounds. That earlier proceeding had already brought the activity and manufacturing process to the notice of the Revenue. In these circumstances, the Revenue could not again sustain an allegation that the assessee had misdeclared the product or suppressed facts so as to justify the extended period. The demand was therefore examined only on the limitation point and not on the merits.

Conclusion: The demand was held to be time-barred and the invocation of the extended period failed, in favour of the assessee.

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