Limitation and suppression in excise returns: disclosed clearances barred use of the extended period for demand.

Returned carbon black received under D-3 declaration and recorded in statutory registers, with clearances made under gate passes describing the goods as duty-paid and only differential duty paid. On those facts, no suppression of material facts was established, because the clearances were disclosed and Rule 173H did not require separate processing or departmental intimation of reprocessing. The Department therefore could not invoke the extended limitation period, and any demand had to be raised within the normal period; the demand was time-barred.

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Issues: Whether the demand was barred by limitation and the extended period could be invoked on the allegation of suppression of facts.

Analysis: The returned carbon black was received under D-3 declaration, accounted for in the statutory records, and cleared under gate passes describing the goods as duty-paid, with only differential duty being paid. The gate passes disclosed the relevant clearances, and there was no requirement under Rule 173H that the returned goods be processed separately or that intimation of reprocessing be given to the Department. In these circumstances, no suppression of material facts was established, and the Department could not rely on the extended period. The demand, if any, ought to have been raised within the normal limitation period.

Conclusion: The demand was time-barred and the extended period was not available.

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