Extended limitation and suppression rejected where Section 11C notification supported bona fide belief; normal-period demands were preserved.

Extended limitation for recovery and penalty was not available where the assessee's practice was covered by a Section 11C notification and earlier Tribunal rulings supported a bona fide belief that duty was not intended to apply for the longer period. On that basis, wilful misdeclaration or suppression of facts was not established for invoking the extended period, and the related allegation failed. Demands otherwise raised within the normal limitation period were preserved and remained payable.

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Issues: Whether the extended period for recovery and penalty could be invoked on the allegation of wilful misdeclaration and suppression of facts, in the light of the Section 11C notification and the earlier Tribunal rulings.

Analysis: The appeals did not turn on the substantive dutiability of the goods, but on limitation and the availability of the extended period. The Tribunal relied on its earlier decisions involving the same exemption scheme and held that issuance of a notification under Section 11C supported a bona fide belief that the practice adopted by the assessee was not intended to attract duty for the longer period. On that footing, and applying the earlier rulings, the Tribunal accepted that wilful suppression or wilful misdeclaration was not established for the purpose of extending limitation. At the same time, the Tribunal preserved the demands that were otherwise within the normal period.

Conclusion: The extended period was held not invocable, and the allegation of wilful suppression failed; the assessee remained liable only for demands within limitation.

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