Extended limitation under central excise needs proven suppression or intent to evade, not mere non-acceptance of a disclosed claim.

The proviso to Section 11A of the Central Excise Act, 1944 could not be invoked where the assessee had disclosed the relevant claim in returns and self-assessment, and the department had adequate opportunity to examine it. In the absence of any positive material showing fraud, wilful misstatement, suppression of facts, or concealment with intent to evade duty, the extended period of limitation was unavailable. Mere non-acceptance of the claim and departmental inaction within the normal period were insufficient to sustain extended limitation or penalty on that basis.

---

---

Issues: Whether the proviso to Section 11A of the Central Excise Act, 1944 could be invoked to apply the extended period of limitation on the ground of suppression of facts or intent to evade duty, and whether penalty could be sustained on that basis.

Analysis: The assessee had filed returns and disclosed the relevant claim in the course of self-assessment. The record showed that the department had sufficient opportunity to examine the claim when the returns were filed, and no material was shown to establish a positive act of fraud, wilful misstatement, suppression of facts, or concealment with intent to evade duty. Mere non-acceptance of the assessee's claim, without timely departmental action within the normal period, was insufficient to justify the extended limitation period.

Conclusion: The proviso to Section 11A could not be invoked on the facts, the extended period of limitation was unavailable, and penalty could not be imposed on that basis; the assessee succeeded to that extent.

---