Limitation and exemption under Notification No. 43/75: disclosed facts defeated extended duty demand, while aluminium-alloy castings remained non-exempt.

Duty demand was held barred by limitation because the classification list disclosed manufacture of non-ferrous castings and the exemption claim, the Department had approved it, and the scoring off of entries without prescribed remarks or independent proof did not establish suppression or misstatement. The extended period could not therefore be invoked. On exemption, Notification No. 43/75 was construed strictly: aluminium castings made from aluminium alloys were not treated as castings from virgin aluminium in crude form or qualifying scrap, so the exemption did not apply to such goods.

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Issues: (i) Whether the duty demand was barred by limitation in the absence of misstatement or suppression of material facts; (ii) whether aluminium castings manufactured from aluminium alloys/ingots were eligible for exemption under Notification No. 43/75.

Issue (i): Whether the duty demand was barred by limitation in the absence of misstatement or suppression of material facts.

Analysis: The classification list contained the relevant declaration regarding manufacture of non-ferrous castings and the claim for exemption, and it had been approved by the Department. The scoring off of entries, without supporting remarks in the prescribed form and without independent proof of manipulation, did not establish suppression or misstatement. Since the Department had notice of the relevant facts, the extended demand could not be sustained.

Conclusion: The demand was barred by limitation and the finding was in favour of the assessee.

Issue (ii): Whether aluminium castings manufactured from aluminium alloys/ingots were eligible for exemption under Notification No. 43/75.

Analysis: The notification was construed strictly. Its condition contemplated aluminium castings made from virgin aluminium in any crude form, or scrap obtained from virgin metal or virgin aluminium, including a combination of those materials. Aluminium in the form of alloys was treated as a manufactured stage and not as virgin aluminium in crude form, so the exemption did not extend to castings made from such alloys.

Conclusion: The exemption was not available to castings manufactured from aluminium alloys and this issue was against the assessee.

Final Conclusion: The appeal succeeded because the demand itself failed on limitation, and the impugned order was set aside on that ground despite the adverse view on exemption eligibility.

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