Second show cause notice in de novo proceedings did not bar the demand; original initiation remained valid.

A second show cause notice issued during de novo proceedings did not create a fresh cause of action or render the demand time-barred, because the original proceedings had already been validly initiated by the Superintendent under Rule 57-I. The later notice by the Assistant Collector was treated as only a further step in the same matter after remand, and it did not alter the character of the proceedings. The earlier notice continued to support the de novo adjudication, so the limitation objection based on the second notice was rejected and the demand was sustained in favour of the Revenue.

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Issues: Whether the second show cause notice issued in de novo proceedings vitiated the demand or made it time-barred, and whether the original proceedings initiated by the Superintendent remained valid.

Analysis: The proceedings had commenced with a show cause notice issued by the Superintendent under Rule 57-I. The remand by the appellate authority led to de novo adjudication, and the later notice issued by the Assistant Collector was only a further step in the same matter. The issuance of a second notice did not alter the character of the proceedings or create a fresh cause of action. The Superintendent was treated as a competent officer for the original initiation of proceedings, and the earlier notice continued to support the de novo adjudication. The appellate finding that the demand was barred by limitation on account of the second notice was not accepted.

Conclusion: The second show cause notice did not invalidate the proceedings and did not bar the demand on limitation; the appeal was decided in favour of the Revenue.

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