Statutory limitation for excise duty notices runs from the relevant date, not from discovery of breach or revenue knowledge.

Section 11A of the Central Excise Act prescribes a self-contained limitation scheme for recovery of duty, with the normal period running from the statutorily defined relevant date and an extended period available only in cases involving fraud, collusion, wilful misstatement, suppression of facts, or intent to evade duty. The Court held that this statutory starting point cannot be replaced by a discovery-based or knowledge-based date, and that exemption conditions or bonds do not create a separate limitation regime. On that construction, the notice in issue was time barred and the demand could not be sustained.

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Issues: Whether a demand under section 11A of the Central Excise Act, 1944 arising from alleged breach of exemption conditions could be sustained by reckoning limitation from the date of discovery or knowledge of the Revenue instead of the statutory relevant date, and whether the notice issued in the present case was time barred.

Analysis: Section 11A provides a self-contained scheme for recovery of duty not levied, short-levied, not paid, short-paid, or erroneously refunded. The normal period is one year from the relevant date, extended to five years in cases of fraud, collusion, wilful misstatement, suppression of facts, or contravention with intent to evade duty. The definition of relevant date in section 11A(3)(ii)(C) fixes the starting point as the date on which duty is to be paid under the Act or the rules, and the Court held that this language cannot be enlarged by importing a discovery-based or knowledge-based starting point. The existence of an exemption notification, conditional exemption, or bond does not create a separate limitation regime. Those instruments may regulate liability and compliance, but they do not override the statutory time limit for issuing notice under section 11A. The Court also held that the cited authorities did not support the Revenue's proposition that the period should run from the date of discovery of fraud.

Conclusion: The demand was barred by limitation on the facts of the case, and the notices and consequential orders could not be sustained.

Ratio Decidendi: For recovery of excise duty under section 11A, limitation must be computed strictly from the statutorily defined relevant date, and neither discovery of breach nor the Revenue's knowledge can substitute that date for extending the notice period.

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