(1) THE only question that arises for consideration in this appeal is whether the Department was justified in initiating proceedings for short levy by invoking proviso to Section 11-A of the central Excises and Salt Act, 1944 for the years 1978-79, 1979-80, 1980-81 and 1981-82.

(2) THE appellant manufactured an item falling under Tariff Entry 14-E as well as another item under Item 68. The item under Item 68 was fully exempt from payment of duty. The value of items manufactured under Tariff Item 14-E in each year was less than Rs. 5 lakhs. Notification No. 111 of 1978 was issued on 9/5/1978 exempting the turnover of goods manufactured under Item 14-E if it was below Rs. 5 lakhs. Therefore, the appellant surrendered its licence and it was cancelled. Notices were, however, issued because if the turnover of the two items, i.e., exempted under Item 68 for the years in dispute was clubbed together with turnover of Item 14-E, then it exceeded Rs. 5 lakhs and the goods became liable to duty. The Department invoked extended period of limitation of five years as according to it the duty was short-levied due to suppression of the fact that if the turnover was clubbed then it e