Limitation for extended demand fails where the show cause notice omits fraud or suppression allegations

A demand cannot be sustained for the extended period where the show cause notice does not allege misstatement, fraud, suppression or comparable facts required to invoke that period. Such allegations cannot be implied into the notice. The limitation objection was also entertainable even though it had not been raised earlier, because a pure question of law may be urged at any stage. The demand was therefore barred by limitation and failed for the extended period.

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Issues: Whether the demand was barred by limitation for want of allegations in the show cause notice necessary to invoke the extended period.

Analysis: The show cause notice was examined and found not to contain allegations of mis-statement, fraud, suppression or similar facts required for invoking the extended period under the proviso to the relevant rule. Such allegations could not be read into the notice by implication. The objection on limitation was entertainable even though it had not been raised before the Assistant Commissioner, since a point of law may be urged at any stage.

Conclusion: The demand was hit by limitation and could not be sustained for the extended period.

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