Extended limitation barred for excise demand where declared clearances showed no suppression and the transaction was revenue neutral.

Duty demand was held time-barred because the extended limitation period could not be invoked without proof of suppression of material facts. The assessee had cleared aluminium remnants under challans and after filing declaration, and the goods were described as remnants arising from the manufacturing process. On those facts, the department failed to establish suppression or wrong description sufficient to justify the larger period. The transaction was also treated as revenue neutral, as the goods were received back after processing from the job worker. The demand was therefore not sustainable on limitation.

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Issues: Whether the demand was barred by limitation on the ground that there was no suppression of facts and, therefore, the extended period under the excise law could not be invoked.

Analysis: The dispute turned on whether the assessee had cleared aluminium remnants as scrap under a wrong description so as to justify invocation of the larger limitation period. The materials on record showed that the clearances were made under challans and after filing declaration, and the Tribunal accepted that the goods were described as remnants of aluminium rods arising from the manufacturing process. On these facts, the invocation of the extended period required proof of suppression, which was not established. The Tribunal also noted that the transaction was revenue neutral because the goods were received back after processing from the job worker.

Conclusion: The demand was time-barred and the extended period could not be invoked.

Final Conclusion: The Revenue's challenge failed, and the order dropping the demand on limitation was sustained.

Ratio Decidendi: Where goods are cleared under declared documentation and the department fails to establish suppression of material facts, the extended limitation period cannot be invoked, particularly when the transaction is revenue neutral.

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