Extended limitation in central excise requires proof of fraud or suppression; absent such evidence, the duty demand is time-barred.

The extended period of limitation under central excise law can be invoked only where fraud, collusion, wilful misstatement or suppression of facts with intent to evade duty is affirmatively proved. On the record, there was no material showing collusion between the appellant and the buyer, no reliable evidence of a deliberate scheme to evade duty, and the buyer had not been separately charged duty; the necessary ingredients for the proviso to Section 11A(1) were therefore not established. The demand notice having been issued beyond the normal limitation period, the duty demand was time-barred and could not be sustained on limitation.

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Issues: Whether the extended period of limitation under the central excise law could be invoked for confirmation of duty demand on the ground of fraud, collusion, wilful misstatement or suppression of facts with intent to evade duty.

Analysis: The demand notice was issued beyond the normal limitation period, so invocation of the proviso to Section 11A(1) required proof that non-levy or short levy resulted from fraud, collusion, wilful misstatement or suppression of facts with intent to evade duty. On the record, the Tribunal found no material establishing collusion between the appellant and the buyer, and the earlier penalty on the buyer had already been set aside. In the absence of duty having been separately charged from the buyer and without reliable evidence of a deliberate scheme to evade duty, the necessary ingredients for the extended period were not made out.

Conclusion: The extended period of limitation was not invocable and the duty demand was time-barred.

Final Conclusion: The demand and the impugned order could not be sustained on limitation, and the appellant obtained relief on that ground.

Ratio Decidendi: The extended period of limitation can be invoked only when suppression, fraud, collusion or wilful misstatement with intent to evade duty is affirmatively established; absent such proof, a time-barred demand cannot be sustained.

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