Extended limitation for undisclosed clearances upheld; bona fide belief under the exemption notification was rejected.

Extended limitation was held invocable where the assessee had not disclosed manufacture and clearance of thinner to the department and had omitted its value from the RT-12 returns. The asserted bona fide belief under Notification No. 71/78-CE, as amended by Notification No. 141/79 dated 30-3-1979, was rejected because the amended notification covered only specified exempt goods, and thinner was not a specified commodity. On that basis, the duty demand was sustained.

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Issues: Whether the extended period of limitation was invocable for demanding duty on the ground that the assessee had not disclosed the manufacture and clearance of thinner and had excluded its value from the returns, and whether the assessee could claim bona fide belief under Notification No. 71/78-CE as amended by Notification No. 141/79 dated 30-3-1979.

Analysis: The assessee failed to produce any material showing that manufacture of thinner without the aid of power had been disclosed to the department. The finding that the value of thinner clearances was not included in the RT-12 returns remained unrebutted. The claimed bona fide belief was held to be unsupported, since the amended notification excluded the value of clearances only of specified goods otherwise exempted, and thinner was not a specified commodity under Notification No. 71/78-CE.

Conclusion: The extended period of limitation was rightly invoked and the demand of duty was sustainable against the assessee.

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