Refund limitation cannot be sustained on grounds not pleaded in the show cause notice, protecting fair opportunity in adjudication.

A refund claim arising after amalgamation could not be rejected as time-barred where the show cause notice did not clearly plead the relevant date or the legal basis for limitation. The authorities could not introduce a fresh limitation ground by treating the date of payment as the relevant date or by denying the applicability of clause (ec) of section 11B, because adjudication must remain confined to the allegations in the notice and the assessee must have a fair opportunity to meet the case. On that basis, rejection of the refund on limitation was held unsustainable and relief was granted to the assessee.

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Issues: Whether the refund claim could be rejected as time-barred when the show cause notice did not clearly allege the relevant date or the legal basis for limitation.

Analysis: The refund claim arose after amalgamation and the department sought to reject it on limitation, but the notice itself only referred to non-production of documents and did not set out any clear basis for treating the claim as time-barred. The authorities below introduced a limitation ground by identifying the date of payment as the relevant date and by rejecting the applicability of clause (ec) of section 11B, even though that ground was not properly put to the appellant in the notice. An adjudication cannot travel beyond the allegations in the show cause notice, and the assessee must be given a fair opportunity to meet the case against it.

Conclusion: The rejection of refund on limitation was unsustainable and the issue was decided in favour of the assessee.

Ratio Decidendi: A refund claim cannot be denied on a ground not clearly pleaded in the show cause notice, and the adjudicating authority cannot go beyond the notice to sustain limitation.

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