Central excise limitation barred a duty demand where no suppression existed and a later notice could not revive it

Central excise duty demand was held time-barred where no provisional assessment under Rule 9B was followed and the department relied only on the normal six months' limitation under Rule 10. In the absence of any allegation of misstatement, suppression of facts, collusion, or similar grounds, the relevant date remained the clearance of goods from the factory, and the later show cause notice could not revive a demand already barred by limitation. The duty demand was therefore liable to be set aside.

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Issues: Whether the demand of central excise duty was barred by limitation in the absence of provisional assessment, and whether the later show cause notice could revive a time-barred demand.

Analysis: The classification dispute and valuation plea had been given up, leaving only limitation for decision. No procedure for provisional assessment under Rule 9B of the Central Excise Rules, 1944 had been followed. The revenue itself proceeded on the footing that the second show cause notice superseded or cancelled the earlier notice. In the absence of any allegation of misstatement, suppression of facts, collusion, or similar grounds, the normal six months' limitation under Rule 10 of the Central Excise Rules, 1944 applied. The relevant date was the date of clearance of the goods from the factory, and on that basis the demand could not be sustained.

Conclusion: The demand was barred by limitation and was liable to be set aside.

Final Conclusion: The appeal succeeded because the duty demand could not be enforced beyond the prescribed limitation period.

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