Extended period limitation under central excise fails where bona fide classification belief negates intent to evade duty.

The extended period under the proviso to Section 11A(1) of the Central Excise Act, 1944 applies only where the Revenue establishes suppression, mis-declaration, contravention of law or rules, and an intention to evade duty. On the facts noted, the goods were covered in All Industry Rate of Drawback notifications under Chapter heading 9506, and duty had been discharged on that basis, which supported a bona fide belief on classification. As the element of intent to evade duty was not established, the demand was held time-barred and consequential relief followed.

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Issues: Whether the demand was barred by limitation under the extended period on the ground of suppression or intent to evade duty.

Analysis: The show cause notice invoked the proviso to Section 11A(1) of the Central Excise Act, 1944 for a past period. For the extended period to apply, the Revenue had to establish suppression, mis-declaration, contravention of law or rules, and intention to evade duty. The goods were shown in the All Industry Rate of Drawback notifications under Chapter heading 9506, and the assessee had discharged duty on that basis, supporting a bona fide belief regarding classification. On those facts, the necessary element of intent to evade duty was not established.

Conclusion: The demand was held to be time-barred, the appeals were allowed, and consequential relief was granted.

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