CESTAT grants relief, rejects Department's appeal in duty dispute. No suppression found, extended period unjustified.

The Appellate Tribunal CESTAT, New Delhi allowed the party's cross-objection and rejected the Department's appeal in a dispute over duty demand and penalty imposition. The Tribunal found that issuing a notice invoking the extended period under Section 11A after withdrawing an earlier notice was unwarranted. It concluded that there was no suppression of facts by the party to justify invoking the extended period of limitation, leading to the rejection of the Department's appeal and granting relief to the party.

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Issues:
1. Appeal against the order of Commissioner (Appeals) regarding duty demand and penalty imposition.
2. Challenge to the demand of duty by the party in cross-objection.
3. Invocation of normal period of limitation versus extended period under Section 11A.
4. Allegation of suppression of relevant facts by the party to evade duty.

Analysis:
1. The appeal before the Appellate Tribunal CESTAT, New Delhi involved a dispute between the Department and the party regarding duty demand and penalty imposition. The party, a cement manufacturer, used clinkers produced in their factory and bought out clinkers. The Department issued a show cause notice proposing duty demand without invoking the proviso to Section 11A, which was later withdrawn. Subsequently, another notice was issued invoking the proviso to Section 11A. The original authority confirmed the duty demand but set aside the penalty imposed, leading to the Department's appeal seeking restoration of the penalty while the party filed a cross-objection challenging the duty demand.

2. The party contended that since a show cause notice invoking the normal period of limitation had been issued earlier and withdrawn, issuing another notice invoking the extended period under the proviso of Section 11A was unwarranted. The party argued that the appeal by the Department should be rejected on this ground, and the cross-objection should be allowed.

3. The Department, on the other hand, alleged that the party had suppressed relevant facts by choosing to pay duty at a lower rate applicable to cement manufactured using clinkers produced within the factory, even for cement manufactured using bought out clinkers. The Department claimed this amounted to an intent to evade duty. However, the Tribunal noted that the party had disclosed the use of both types of clinkers in their declarations and had taken Modvat credit on clinkers purchased from third parties. The Tribunal found no suppression of facts by the party to justify invoking the extended period of limitation under Section 11A.

4. After considering the submissions from both sides, the Tribunal concluded that the show cause notice issued on the same set of facts invoking the extended period of limitation was not justified, especially after the earlier notice had been withdrawn. Therefore, the Tribunal allowed the party's cross-objection, providing consequential relief as per law, and rejected the Department's appeal.

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