Limitation in excise duty disputes turns on disclosure of the transaction basis; disclosed agreements defeat extended-period suppression claims.

Disclosure of the sourcing agreement to the department was sufficient to put it on notice of the basis of the transactions, and the revenue failed to show any undisclosed direct or indirect consideration outside that agreement. On those facts, the allegation that a separate full settlement had not been furnished did not establish suppression of material facts. The extended period of limitation under central excise law was therefore not available, and the differential duty demand was barred by limitation in favour of the assessee.

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Issues: Whether the demand for differential central excise duty was barred by limitation because the agreement governing the transaction had already been disclosed to the department, and whether the extended period could be invoked on the allegation of suppression of material facts.

Analysis: The transactions between the assessee and the other contracting parties were governed by the sourcing agreement, and that agreement had been made available to the department in March-April 1995. The revenue did not show that any alleged direct or indirect consideration flowed from a source outside the disclosed agreement. Mere production of the agreement was sufficient to put the department on notice of the basis of the transactions, and the further allegation that the full settlement had not been separately furnished did not establish suppression so as to justify the extended limitation period.

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

Ratio Decidendi: Where the basis of the transactions is disclosed to the department and the department has no material showing suppression of facts beyond that disclosure, the extended period under the central excise law cannot be invoked.

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