Fresh show cause notice treated as independent; demand held time-barred for limitation purposes.

A later show cause-cum-demand notice was treated as a fresh and independent notice because it made no reference to the earlier notices or any continuation of the prior appellate proceedings. On that footing, the notice had to stand on its own for limitation purposes, and the resulting demand was held time-barred. The analysis therefore turns on the legal effect of an unconnected subsequent notice: where no link to the earlier proceedings is shown, limitation runs from the fresh notice, and an out-of-time demand cannot be sustained.

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Issues: Whether the show cause-cum-demand notice issued on 29-3-1978 was a fresh notice in law and, if so, whether the demand was barred by limitation.

Analysis: The earlier round of proceedings had ended with the appellate order dated 30-1-1974, but the impugned notice of 29-3-1978 made no reference to the earlier notices or to any continuation of those proceedings. In the absence of any indication that the later notice was issued in pursuance of the earlier appellate order, it had to be treated as an independent and fresh starting point for adjudication. On that basis, the notice was beyond time and the resulting demand could not be sustained.

Conclusion: The notice was barred by limitation and the appeal succeeded on that ground in favour of the assessee.

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