Extended excise limitation requires proof of deliberate suppression or intent to evade duty; procedural lapses alone are insufficient.

The extended limitation period under excise law cannot be invoked unless the Department proves suppression of material facts, misstatement, fraud, collusion, or deliberate contravention with intent to evade duty. Mere failure to file a declaration, obtain a central excise licence, or complete procedural formalities does not by itself establish wilful evasion where the unit was registered, held the relevant board licences, and operated on a relatively small scale under a plausible belief that duty was not payable. On those facts, the demand was time-barred and the penalty was not sustainable.

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Issues: Whether the extended period of limitation under Section 11A was invocable on the facts, and whether the demand and penalty could be sustained in the absence of deliberate suppression or intent to evade duty.

Analysis: The demand notice covered a period beyond the normal six-month limitation and could survive only if the Department established suppression of material facts, misstatement, collusion, fraud, or contravention of the rules with intent to evade duty. The manufacturing activity was not clandestine: the unit was registered with the District Industries Centre, had obtained Rubber Board licences, and the clearances were relatively small and within the concessional slab then available. The failure to file a declaration, take a central excise licence, or follow procedural formalities was held not to amount, by itself, to deliberate suppression or wilful evasion. The lapse was treated as consistent with a bona fide belief that duty was not payable and that the concessional notifications and formalities were inapplicable.

Conclusion: The extended period under Section 11A was not attracted, the duty demand was time-barred, and the penalty was not sustainable.

Ratio Decidendi: Mere non-declaration or procedural non-compliance, without positive suppression of facts or conscious intent to evade duty, is insufficient to invoke the extended limitation period under excise law.

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