Retrospective excise levy does not override limitation under Section 11A for differential duty recovery.

A retrospective excise levy and a retrospective notification do not displace the limitation period under Section 11A of the Central Excises and Salt Act, 1944. The demand for differential central excise duty must be computed with reference to when duty became payable for the relevant clearances, and recovery can operate only within the statutory period preceding the show cause notice. On that basis, the demand was barred to the extent it related to the period beyond six months before the notice, and that part of the recovery was set aside.

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Issues: Whether the demand for differential central excise duty raised under the retrospective notification and Section 52 of the Finance Act, 1982 was barred by limitation under Section 11A of the Central Excises and Salt Act, 1944.

Analysis: The retrospective provision and the notification created liability to pay duty for the past period, but they did not exclude the application of Section 11A. The limitation under Section 11A had to be reckoned with reference to the date on which duty became payable in relation to the clearances in question, and the demand could operate only within the statutory period preceding the show cause notice. The attempted recovery of differential duty for the earlier part of the period therefore remained subject to the limitation prescribed by Section 11A.

Conclusion: The demand was barred by limitation to the extent it related to the period beyond six months before the show cause notice and was set aside for that part; the assessee succeeded on the limitation issue.

Ratio Decidendi: A retrospective excise levy does not override the limitation contained in Section 11A of the Central Excises and Salt Act, 1944, and recovery of differential duty remains confined to the statutory period of limitation.

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