Reasonable period applies to drawback recovery when no limitation is prescribed; delayed notices were held time-barred.

Rule 16 of the Customs & Central Excise Duties Drawback Rules, 1995 permits recovery of drawback paid erroneously or in excess, but because it fixes no express limitation period, recovery must be initiated within a reasonable time. Applying that principle, the Gujarat HC held that show cause notices issued in February 2000 to recover drawback paid between December 1995 and August 1996 were issued after an inordinate delay of more than three years. As the claim had already attained finality and no timely recovery action was taken, the notices were time-barred and the consequential recovery order could not be sustained.

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Issues: Whether, in the absence of any express period of limitation in Rule 16 of the Customs & Central Excise Duties Drawback Rules, 1995, recovery of erroneously paid drawback can be initiated only within a reasonable period, and whether show cause notices issued after more than three years were time-barred.

Analysis: Rule 16 authorises recovery of drawback paid erroneously or in excess and provides for recovery under Section 142 of the Customs Act, 1962, but it does not prescribe any limitation period. The Court applied the settled principle that where a statute confers a power without fixing a limitation period, the power must be exercised within a reasonable time. On the facts, drawback had been paid between December 1995 and August 1996, whereas the show cause notices were issued only in February 2000. Such delay of more than three years was held to be beyond any reasonable period, particularly because the claim had already attained finality and the authorities had taken no timely recovery action.

Conclusion: The show cause notices were time-barred, and the consequential order of recovery could not be sustained.

Ratio Decidendi: Even where a recovery provision contains no express limitation, a reasonable period is read into it, and recovery proceedings initiated after an inordinate and unjustified delay are invalid.

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