Writ jurisdiction and extended excise limitation: alternative remedy did not bar review, and suppression was not proved.

The availability of a statutory appeal under excise law does not by itself bar writ jurisdiction under Article 226; the alternative-remedy rule is discretionary and does not exclude review where jurisdictional error or other exceptional grounds exist. The proviso to Section 11A of the Central Excise Act can be invoked only on proof of fraud, collusion, wilful misstatement, suppression of facts, or intent to evade duty. Where the assessee had repeatedly disclosed the relevant facts and the department failed to prove deliberate concealment or support its contrary view with reliable evidence, the extended limitation could not be applied. The demand beyond limitation and related penalties were therefore unsustainable to that extent.

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Issues: (i) Whether the writ petition was not maintainable because Section 35L provided an appeal to the Supreme Court against the excise classification and valuation dispute. (ii) Whether the extended period under Section 11A could be invoked on the ground of suppression or wilful misstatement, and whether the demand, interest and penalties could stand.

Issue (i): Whether the writ petition was not maintainable because Section 35L provided an appeal to the Supreme Court against the excise classification and valuation dispute.

Analysis: The availability of a statutory appeal does not by itself oust the High Court's power of judicial review under Article 226 of the Constitution of India. The rule requiring exhaustion of alternative remedies is one of discretion, not compulsion, and does not bar writ jurisdiction in every case. The Court also noted that the appellate remedy under Section 35L of the Central Excise Act, 1944 is not an absolute bar to writ interference where jurisdictional error or other exceptional grounds are shown.

Conclusion: The writ petition was maintainable and the preliminary objection was rejected.

Issue (ii): Whether the extended period under Section 11A could be invoked on the ground of suppression or wilful misstatement, and whether the demand, interest and penalties could stand.

Analysis: In fiscal matters, the statute must be construed strictly, and the proviso to Section 11A of the Central Excise Act, 1944 can be applied only when the department proves fraud, collusion, wilful misstatement, suppression of facts, or contravention with intent to evade duty. The materials on record showed repeated disclosure by the assessee, earlier approvals of classification, and no reliable finding of deliberate concealment. The department did not establish by evidence that the products lacked medicinal character, nor was chemical analysis or comparable contrary material placed to justify reversal of the earlier position. The Court held that a mere change of opinion could not sustain invocation of the extended limitation.

Conclusion: The extended period was not attracted, the demand beyond limitation could not stand, and the adverse findings on duty and penalties were unsustainable to that extent.

Final Conclusion: The petition succeeded in material part, the impugned orders were quashed to the extent adverse to the assessee, and the matter for the subsequent period was remitted for fresh adjudication in accordance with law.

Ratio Decidendi: The existence of an appellate remedy under the excise law does not automatically bar writ jurisdiction, and the extended limitation under Section 11A can be invoked only on proof of deliberate suppression or similar culpable conduct; mere change of opinion or previously disclosed facts is insufficient.

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