Extended limitation requires fraud or suppression; without such allegations, the time-barred demand finding was upheld.

Where proceedings were initiated only for penalties under sections 76 and 77 of the Finance Act, 1994, and the record contained no allegation of fraud, misrepresentation or suppression of facts with intent to evade payment, the demand could not be sustained on an extended limitation basis. In the absence of such allegations, the challenge to the finding that part of the demand was time-barred had no merit, and the order in favour of the assessee was upheld.

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Issues: Whether the demand could be sustained when the proceedings were initiated only for imposition of penalties under sections 76 and 77 of the Finance Act, 1994, and there was no allegation of fraud, misrepresentation or suppression of facts with intent to evade payment.

Analysis: The proceedings originated from a show-cause notice confined to penalties under sections 76 and 77. The record did not contain any allegation of fraud, misrepresentation or suppression of facts with intent to evade payment of duty. In the absence of such allegations, the basis for disturbing the order holding part of the demand time-barred was not made out.

Conclusion: The appeal failed and the impugned order was upheld in favour of the assessee.

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