Extended limitation under central excise law cannot apply where the assessee fully disclosed the goods and their separate pricing.

Material disclosure to the Department of the goods supplied, their separate pricing, and their treatment in invoices and monthly returns defeated any allegation of suppression or wilful misstatement. On those facts, the foundation for invoking the extended limitation period under Section 11A of the Central Excises and Salt Act, 1944 failed, so the duty demand was time-barred and the penalty was unsustainable.

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Issues: Whether the extended period of limitation under Section 11A of the Central Excises and Salt Act, 1944 was invokable on the facts disclosed by the assessee, and whether the penalty imposed was sustainable.

Analysis: The assessee had addressed letters to departmental officers disclosing the supply of photocopiers, the separate pricing of the disputed accessories, and the fact that SADH was supplied only on specific request and treated as a trading item. The invoices and monthly returns also reflected the prices of the photocopiers and the disputed items separately. The Department was aware of the supply of SADH and the installation kit, including the earlier dispute regarding proforma credit on SADH. In these circumstances, the allegation of suppression or wilful misstatement was not made out, and the foundation for invoking the extended period failed.

Conclusion: The extended period of limitation was not available to the Department, the duty demand was barred by limitation, and the penalty was unsustainable.

Ratio Decidendi: Where the assessee has made material disclosure of the goods supplied and their separate pricing to the Department, the extended limitation period cannot be invoked in the absence of suppression or wilful misstatement.

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