Extended limitation cannot apply without suppression of facts; disclosed job-work clearances made the duty demand time barred.

Where the assessee had filed price lists and declarations disclosing that goods were manufactured on job-work basis and cleared on the declared price, the department was held to have knowledge of the relevant facts from the outset. In the absence of suppression of facts or wilful misstatement, the allegation of undervaluation with intent to evade duty could not sustain invocation of the extended period. The demand for duty, interest and penalty was therefore held time barred and could not be maintained.

---

---

Issues: Whether the duty demand, interest and penalty were barred by limitation and whether the extended period could be invoked in the absence of suppression of facts or wilful misstatement.

Analysis: The assessee had filed price lists and declarations with the jurisdictional officer, informing the department that goods were being manufactured on job-work basis for STPL and cleared on payment of duty at the price declared by STPL. The record showed that these facts were within the knowledge of the department from the outset. In such a situation, the allegation of undervaluation with intent to evade duty was found unsustainable, and no basis remained for invoking the extended period. Since the adjudicating authority had not properly dealt with limitation and the first appellate authority had correctly appreciated the disclosed facts, the demand could not be sustained as time barred.

Conclusion: The demand was held to be barred by limitation and the invocation of the extended period was rejected.

Final Conclusion: The assessee succeeded on the issue of limitation, and the Revenue's challenge to the setting aside of the demand, interest and penalty failed.

Ratio Decidendi: Where the relevant facts are disclosed to the department and there is no suppression or wilful misstatement, the extended period of limitation cannot be invoked and the demand is time barred.

---