Extended limitation under excise law fails where no suppression or intent to evade duty is shown.

Removal of inputs as such under Rule 3(4) of the Central Excise Rules, 2002 was held not to justify the extended period where the law on the issue had seen conflicting views and earlier decisions had already considered it. In the absence of fraud, collusion, wilful misstatement, suppression of facts, or any deliberate intent to evade duty, the statutory conditions for invoking the extended limitation period were not met. The assessee had also disclosed the relevant information during audit and acted under a bona fide understanding of the legal position, so the demand was barred by limitation.

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Issues: Whether the demand was barred by limitation and the extended period under the excise law could be invoked in the facts of the case.

Analysis: The dispute related to removal of inputs as such on payment of duty computed under Rule 3(4) of the Central Excise Rules, 2002. The Tribunal noted that the issue had already been considered in earlier decisions and that conflicting views had existed on the correct position of law. In such a situation, and in the absence of findings showing fraud, collusion, wilful misstatement, suppression of facts, or any deliberate act with intent to evade duty, the conditions for invoking the extended period were not satisfied. The record also showed that the assessee had furnished the relevant information during audit and had acted under a bona fide understanding of the legal position.

Conclusion: The extended period of limitation was not invocable and the demand was barred by limitation.

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