Suppression of facts in excise records triggers interest and penalty when losses are not disclosed to the Department.

Non-disclosure of losses of excisable goods in statutory records constituted suppression of facts where the assessee did not inform the Department during the relevant period. The later reversal of credit did not cure the earlier failure to disclose the losses. On that basis, the extended period of limitation was attracted and the statutory consequences followed, making interest under Section 11AB and penalty under Section 11AC leviable. The order denying such consequences was therefore incorrect, and the revenue's position was restored.

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Issues: Whether interest and penalty were leviable on the assessee on account of non-disclosure of losses of excisable goods in the statutory records.

Analysis: The losses of Rectified Spirit, Ordinary Denatured Spirit and Special Denatured Spirit were not reflected in the statutory records and were not disclosed to the Department during the relevant period. The subsequent reversal of credit did not erase the earlier suppression of facts. In such circumstances, the conditions for invoking the extended period of limitation and for attracting the statutory consequences of interest and penalty were satisfied.

Conclusion: Interest under Section 11AB of the Central Excise Act, 1944 and penalty under Section 11AC of the Central Excise Act, 1944 were leviable, and the order denying such consequences was incorrect.

Final Conclusion: The Revenue succeeded, and the adjudicating authority's order levying interest and imposing penalty was restored.

Ratio Decidendi: Where losses of excisable goods are not disclosed in statutory records and the Department is not informed during the relevant period, suppression of facts is established and the statutory liability to interest and penalty follows.

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