Limitation for short levy claims turns on departmental misconstruction, and the residuary excise rule cannot sustain a time-barred demand.

A demand for short levy was held to fall under the specific limitation rule because it arose from departmental misconstruction and uncertainty about the product classification, with a prior notice having been withdrawn. On that basis, Rule 10 applied rather than the residuary Rule 10A, and the demand was treated as time-barred and unsustainable under the wider provision. The impugned demand was therefore set aside, without examination of the merits of classification.

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Issues: Whether the demand was barred by limitation and whether Rule 10A of the Central Excise Rules applied instead of Rule 10 of the Central Excise Rules.

Analysis: The demand related to an earlier period, had been preceded by a withdrawn notice, and the department itself had entertained doubt regarding the classification of the product. In such circumstances, the short levy, if any, arose from a mistake in construction by the officers. The liability therefore fell within the ambit of Rule 10 and not the wider residuary provision under Rule 10A.

Conclusion: The demand was time-barred and could not be sustained under Rule 10A.

Final Conclusion: The impugned demand was set aside and the appeal was allowed without entering into the merits of classification.

Ratio Decidendi: Where the short levy arises from departmental misconstruction and the case is covered by the specific limitation provision, the demand cannot be sustained under the residuary rule.

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