Extended limitation under central excise law fails where approved classification and no suppression or misstatement are shown.

CESTAT, Kolkata held that the extended period under the proviso to section 11A was not available because the department failed to show suppression of facts or misstatement with intent to evade duty. The assessee had filed a classification list that was approved by the jurisdictional proper officer, and later testing was undertaken only to secure uniform classification. A disputed classification claim, by itself, did not establish mala fides, especially where the officer could have sought testing or further clarification before approval. The demand was therefore wholly time-barred in favour of the assessee.

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Issues: Whether the demand of central excise duty was barred by limitation on the ground that the extended period under the proviso to section 11A could not be invoked in the absence of suppression or misstatement by the assessee.

Analysis: The appellant had filed a classification list classifying the product as claimed, and the list had been approved by the jurisdictional proper officer. The record also showed that the product was later tested only for achieving uniform classification and that the notification relied upon treated the product as a refined diesel oil. On these facts, the claim of classification under one heading could not, by itself, establish mala fides. The officer could have required testing or further clarification before approving the classification list, and no specific material was shown to prove suppression of facts or misstatement with intent to evade duty.

Conclusion: The extended period of limitation was not available and the demand was wholly time-barred in favour of the assessee.

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