Limitation in central excise demand: Rule 196 treated as self-contained, and absence of suppression did not bar enforcement.

Central excise duty demand was challenged on limitation, with the assessee arguing that no misdeclaration or suppression justified invocation of the extended period. The goods had been removed without duty on the footing that they were needed for maintenance and repairs, but they were found not to be machinery installed in the factory. The demand under Rule 196, read with Section 11A(1), was treated as part of a self-contained scheme, and the absence of fraud, collusion, suppression or wilful misstatement did not bar enforcement beyond the ordinary period in the facts found. The plea of time-bar was rejected and the demand was held enforceable.

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Issues: Whether the demand of central excise duty was barred by limitation and whether the extended period could be invoked despite the assessee's plea of absence of mis-declaration or suppression.

Analysis: The only issue pressed was limitation. The goods were removed without payment of duty on the basis that they were required for maintenance and repairs, but the finding was that wagons could not be treated as machinery installed in the factory. The demand had been raised under Rule 196 and also with reference to Section 11A(1). It was held that the proceedings under Rule 196 formed a self-contained scheme and that, in the facts found, the absence of fraud, collusion, suppression or wilful mis-statement did not prevent enforcement of the demand beyond the ordinary period.

Conclusion: The plea that the demand was time-barred was rejected and the demand was held enforceable.

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