Declared valuation of captively consumed packing materials could not be reopened; suppression and extended limitation were not made out.

Captively consumed printed packing materials were valued on cost data and departmental directions, and the assessee had furnished price declarations and supporting documents before the authorities. Because the earlier valuation orders and approvals had attained finality, and the department had accepted the declared valuation without timely challenge, allegations of intentional suppression or misstatement were not sustainable. The factory being under departmental physical control and no lawful reopening or rejection of the declarations being shown, the foundation for invoking the extended period of limitation was absent. The valuation dispute and demand based on undervaluation were therefore not sustainable.

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Issues: Whether the valuation adopted for captively consumed printed packing materials was liable to be reopened on the allegation of undervaluation and suppression of facts, and whether the extended period of limitation could be invoked.

Analysis: The valuation of the goods had been worked out on the basis of the cost data and departmental directions, and the record showed that price declarations and relevant documents had been furnished before the departmental authorities. The earlier orders and approvals on valuation had attained finality, and no material was shown to dislodge the finding that the department had accepted the declared valuation without timely challenge. In such circumstances, the allegation of intentional suppression or misstatement was not sustainable. Since the assessee's factory was under departmental physical control and the declarations were not shown to have been rejected or reopened in the manner required by law, the foundation for invoking the extended period was absent.

Conclusion: The valuation dispute was decided in favour of the assessee and the demand based on undervaluation and extended limitation was not sustainable.

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