Extended limitation under excise law fails where valuation issue is debatable and facts were already known to the department.

The extended period of limitation under excise law cannot be invoked where the relevant facts were already within departmental knowledge and the dispute concerned a debatable valuation issue. Non-inclusion of moulds and dies cost was treated as a bona fide view on an unsettled question, not wilful suppression with intent to evade duty. The show-cause notice was therefore barred by limitation.

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Issues: Whether the extended period of limitation under the excise law could be invoked on the basis of alleged suppression of facts with intent to evade duty.

Analysis: The appeal turned on whether non-inclusion of the cost of moulds and dies in the assessable value amounted to suppression warranting invocation of the extended period. The record showed that the department was already aware of the non-inclusion, and the adjudicating authority had itself noted the relevant facts. The law on includibility of such cost was not clear at the relevant time and was later settled by the Larger Bench decision in Mutual Industries. In that background, the omission to include the cost was treated as arising from a bona fide view on a debatable issue, not from deliberate suppression with intent to evade duty.

Conclusion: The extended period of limitation was not available to the Revenue, and the show-cause notice was barred by limitation.

Ratio Decidendi: Where the relevant facts were within departmental knowledge and the controversy concerned a debatable valuation issue, the extended period cannot be invoked in the absence of wilful suppression or intent to evade duty.

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