Limitation and suppression in excess rebate recovery: extended period failed where the notice lacked specific allegations.

A claim for recovery of excess rebate was held to be time-barred because the show cause notice did not contain any specific allegation of suppression of facts. The department had processed the rebate claim on the basis of records already available to it, including RT 12 returns and duty-payment particulars, so the material necessary to assess the claim was on record. Suppression or misstatement must be specifically alleged and established before the extended limitation period can be invoked. On these facts, the extended period was not sustained, the plea of suppression failed, and the appeal was rejected.

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Issues: Whether the demand for recovery of excess rebate was barred by limitation and whether the extended period could be invoked on the ground of suppression of facts.

Analysis: The show cause notice issued for recovery of the alleged excess rebate did not contain any specific allegation of suppression of facts. The record showed that the rebate claim was processed on documents available to the department, including RT 12 returns and related records, and the departmental authorities had access to the relevant duty-payment particulars. The Court also noted that suppression or misstatement must not only be alleged but must be established before the extended period can be applied. On the facts, the basis for invoking the extended period was not sustained, and the variation in the amount sought to be recovered further weakened the department's case.

Conclusion: The recovery was time-barred, the plea of suppression failed, and the appeal was rejected.

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