Disclosure in classification lists defeats suppression claims and bars extended limitation and penalty for alleged clandestine removal.

Disclosure of the relevant goods in classification lists, when checked and endorsed by departmental officers, defeated the allegation of suppression and clandestine removal. On that factual basis, the extended period of limitation could not be invoked because the premise of concealment was absent. As the foundation for the extended period failed, the penalty imposed on the same allegation also could not survive and was set aside in favour of the assessee.

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Issues: Whether the invocation of the extended period on the basis of suppression and clandestine removal, and the consequent penalty, could be sustained where the classification list had been disclosed and endorsed by the department.

Analysis: The classification lists filed by the appellant from 1-3-1986 and 2-4-1986 described the goods as castings of iron, cast iron and malleable cast iron, and the departmental officers had checked and endorsed them. In the presence of these records, the finding of suppression and clandestine clearance could not stand. Once the foundation for alleging suppression failed, the extended period and the penalty based on that allegation also ceased to survive.

Conclusion: The invocation of the extended period and the penalty were set aside in favour of the appellant.

Ratio Decidendi: Where the assessee has disclosed the relevant goods in a classification list that is checked and endorsed by the department, suppression and clandestine removal cannot be sustained for invoking the extended period and imposing penalty.

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