Extended limitation fails where refund facts were already known to the department and no material suppression was shown.

Limitation under the extended period could not be justified where the only alleged suppression was non-disclosure of an earlier refund claim already within the department's knowledge and sanctioned by the Assistant Collector. The analysis notes that the eligibility issue could have been examined when exemption was granted or when the refund was processed, so there was no discernible suppression of material particulars. On that basis, the demand was treated as time-barred and the assessee succeeded on limitation.

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Issues: Whether the demand was barred by limitation on the allegation of suppression of material facts so as to justify invocation of the extended period.

Analysis: The only basis for alleging suppression was the non-disclosure of the refund claim relating to the earlier financial year. That fact was already within the knowledge of the departmental authorities, since the refund claim had been made before them and was sanctioned by the Assistant Collector. The record also showed that the eligibility question could have been examined when the exemption was granted or when the refund was sanctioned. In these circumstances, there was no discernible suppression of material particulars, and the extended period could not be invoked.

Conclusion: The demand was held to be time-barred and the assessee succeeded on limitation.

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