Modvat credit disclosure in returns defeats suppression allegation and bars use of the extended limitation period.

Disclosure of Modvat credit particulars in statutory returns and accompanying gate passes was held sufficient to put the Department on notice of the receipt of goods and the availment of credit. Although the substituted inputs were not separately declared, the records showed the inputs received, credit taken and utilised, and departmental endorsements on the gate passes further supported disclosure. On those facts, suppression of facts was not established, so the extended period of limitation could not be invoked. The demand notice was therefore barred by limitation.

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Issues: Whether the demand of Modvat credit was barred by limitation on the ground of suppression of facts, in view of the disclosure of the inputs and credit particulars in the returns and accompanying gate passes.

Analysis: The returns filed by the appellant contained the details of Modvat credit taken and utilised, including the particulars of inputs received in the prescribed form. The gate passes under which the goods were received were also furnished and bore endorsements of the Departmental officer showing that Modvat credit had been availed. On these facts, the receipt of goods and availment of credit had been brought to the notice of the Department, despite the non-declaration of the substituted inputs. The ingredients necessary to attract the extended period were therefore not established.

Conclusion: The extended period of limitation was inapplicable and the notice was barred by limitation.

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