Extended limitation unavailable where Revenue takes divergent stands and similar assessees have been granted Cenvat credit.

Denial of Cenvat credit could not survive because the show cause notice had been issued by invoking the extended period of limitation. The CESTAT noted that similarly placed assessees had already been granted the credit and that the Revenue had taken divergent stands by challenging those orders. On that factual basis, the ingredients required to justify extended limitation were not met, so the demand was barred by limitation without any merits examination of the credit claim. The assessee therefore succeeded.

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Issues: Whether denial of Cenvat credit was sustainable when the show cause notice was issued by invoking the extended period of limitation.

Analysis: The credit dispute was not examined on merits. The decisive factor was that similarly placed assessees had been allowed the credit and the Revenue itself had taken divergent stands by filing appeals against such orders. In that situation, the ingredients required for invoking the extended period of limitation were not satisfied. Since the notice had been issued by invoking the extended period, the demand and denial of credit could not survive.

Conclusion: The denial of credit was held to be barred by limitation and the assessee succeeded.

Ratio Decidendi: Where the Revenue takes divergent positions on an issue and similarly placed assessees have been granted the benefit, the extended period of limitation is not available.

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