Reasonable time in excise proceedings blocks revival of stale notices after unexplained long delay.

Excise show cause proceedings cannot be revived after an unexplained delay of about 18 years when they were kept in the call book without a recognised basis. The Court held that, in fiscal matters, even where no express limitation period exists, action must still be taken within a reasonable time. It also found no sufficient foundation for invoking the extended limitation period on grounds of suppression, fraud, wilful misstatement, collusion, or intent to evade duty. The prolonged inaction prejudiced the assessee's ability to defend the matter, so the notices were unsustainable and the proceedings were set aside.

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Issues: Whether the impugned show cause notice and subsequent notices could be revived and continued after an unexplained delay of about 18 years, and whether the invocation of the extended period of limitation under the excise law was justified.

Analysis: The proceedings were kept in the call book without a convincing basis falling within the recognised categories for such transfer. No satisfactory explanation was offered for the prolonged inaction or for the attempted revival after nearly two decades. In fiscal matters, where no express limitation period is prescribed, action must still be taken within a reasonable period. The Court further found that the initial notice did not disclose a sufficient foundation for invoking the extended limitation period on the basis of suppression, fraud, wilful misstatement, collusion or contravention with intent to evade duty. The unexplained delay also seriously prejudiced the assessee's ability to defend the matter effectively.

Conclusion: The revival of proceedings after 18 years was unjustified, the notices were unsustainable, and the challenge succeeded in favour of the assessee.

Final Conclusion: The excise proceedings initiated by the stale notice could not be kept alive indefinitely or resurrected after such extraordinary delay, and the resulting action was set aside.

Ratio Decidendi: Where excise proceedings are sought to be revived after an inordinate and unexplained delay, without a legally supportable basis for keeping the matter pending or a proper foundation for invoking the extended period of limitation, the notices are liable to be quashed as contrary to the requirement of action within a reasonable period and to the demands of fair opportunity.

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