Time limit for scn to eou

[Amresh kumar]

We at a 100% e o u. And have executed the bond.

The department insists that by virtue of Bond the SCN can be issued after Five years also and there is no time limit for this since bond have executed.

Pl advice as the Bond executed also carry's the word that any duty demanded is subject to proviso of Sec 11.

Secondary, Audit objection was raised in December 2017 and SCN have been issued in August 2020. Is this hit by limitation act as every details was mentioned in the monthly return but ss usual dept has invoked suppression clause.

Regards

Amresh kumar

[KASTURI SETHI]

The department's view is totally incorrect and without any basis i.e. legal support (no legs to stand). The department cannot go beyond extended period of 5 years irrespective of the fact whether bond executed or not.

Secondly, in this scenario extended period cannot be invoked inasmuch as all the facts were in the knowledge of the department.

Thirdly, the extended period cannot be invoked on the basis of audit objection. The audit wing raised objection on the basis of statutory records maintained by you. Books of accounts are a statutory.

There is a plethora of case laws in your favour on the ground that the extended period cannot be invoked on the basis detection by the Audit Wing of the department.

You can easily trace out case laws. However, I shall also try to trace out the same and post case laws in you favour.

[Ganeshan Kalyani]

I fully agree with the views of Sri Kasturi Sir. The auditor would have verified all the records before preparing the statement of observation. So, the suppression clause cannot be invoked.

[CABIJENDERKUMAR BANSAL]

Respected Sir

I personally differ with the above views the reason being ----Once there is suppression the period as per the provisions of law is five years there can't be remedy available that it was in your knowledge subsequently at the time of AUDIT please consider this also.

Thanks

[KASTURI SETHI]

Case law based on Supreme Court judgments reported as 2020 (12) TMI 31-CESTAT KOLKATA in the case of BST Infratech and Others Vs. CCE and CGST, BOLPURin favour of the assessee decided on 1.12.2020.

AI Summary

Debate on Time Limits for Show Cause Notices in Central Excise for 100% EOUs: Is a Five-Year Cap Valid? A discussion in a forum focused on the time limit for issuing a Show Cause Notice (SCN) in the context of Central Excise for a 100% Export Oriented Unit (EOU) that executed a bond. The department claimed no time limit existed due to the bond, but one participant argued the department's view lacked legal support, emphasizing a five-year limit and that the extended period cannot be invoked if all facts were known to the department. Others agreed, citing that suppression cannot be claimed post-audit. However, one participant disagreed, stating suppression allows a five-year period regardless of audit findings.