Differential duty demand on separate units failed where no short levy was shown and suppression for extended limitation was unproved.

A differential duty demand failed because the assessee had paid duty in excess and the exemption notification did not require tariff-rate treatment for one unit to be applied automatically to all separate units. On the facts found, there was no short levy in the clearances concerned, so the duty demand was not sustainable. The extended period of limitation also could not be invoked because suppression of facts with intent to evade duty was not established. In the absence of the statutory conditions for the larger period, the demand was barred by limitation and the concurrent orders were upheld in favour of the assessee.

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Issues: (i) whether the assessee was liable to differential duty on the footing that the exemption notification did not permit separate treatment of two units, and (ii) whether the extended period of limitation could be invoked on the ground of suppression of facts with intent to evade duty.

Issue (i): Whether the assessee was liable to differential duty on the footing that the exemption notification did not permit separate treatment of two units.

Analysis: The concurrent findings recorded that the assessee had paid duty in excess of the amount demanded. The notification did not stipulate that once an assessee opted to pay tariff rate in respect of one unit, the same rate must automatically govern clearances from every other unit. On the facts found, there was no short levy in respect of the clearances in question.

Conclusion: The demand for differential duty was not sustainable and the finding was in favour of the assessee.

Issue (ii): Whether the extended period of limitation could be invoked on the ground of suppression of facts with intent to evade duty.

Analysis: The authorities below found no established suppression of facts with intent to evade duty. In the absence of proof of the statutory circumstances required for invocation of the larger period, the demand could not be sustained on limitation either.

Conclusion: The extended period of limitation was not invocable and the finding was in favour of the assessee.

Final Conclusion: The concurrent orders were upheld and the revenue's challenge failed because the assessee had not suffered any short levy and the demand was also barred by limitation.

Ratio Decidendi: Where the assessee has paid duty in excess and the notification does not mandate uniform treatment across separate units, a differential duty demand cannot stand in the absence of short levy; the extended period of limitation is unavailable unless suppression of facts with intent to evade duty is established.

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