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HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR
SANJEEV PRAKASH SHARMA, SANDEEP TANEJA
Daulat And Co. – Appellant
Versus
The Union of India, Through Finance Secretary, North Block, Central Secretariat, New Delhi – Respondent
ORDER :
1. The present writ petition has been filed assailing the show cause notice dated 20.06.2025, issued under Section 11A of Central Excise Act, 1944 (for short ‘the Act’), alleging that the issue notice is beyond limitation.
2. It is further alleged that the notice itself could not have been issued under the Excise Act to the petitioners, who were not the manufacturers, but are the proprietors concerned for engaging trading business and have received goods from another manufacturers.
3. Learned counsel appearing on behalf of the petitioners has relied on Provisions of Section 11A of the Act to submit that any notice issued after a period of five years from the relevant date, would have no force and the same deserves to be quashed on the same that count alone.
4. Learned counsel for the petitioners relies on the judgment passed by the Hon’ble Apex Court in the case of “J.K. Spinning & Weaving Mills Ltd. & Anr. vs. Union of India & Ors. 1987(32) E.L.T. 234 (S.C.).
5. We have considered the submissions and also perused the judgment passed by the Apex Court.
6. It is a case where the petitioners have shown themselves as manufacturers and supplied goods to the retailers and also collect
Fraud vitiates limitations under Section 11A of the Central Excise Act, allowing notices despite elapsed time where fraud or suppression of facts is established.
Show cause notices issued under the Central Excise Act, 1944, are invalid if based on non-statutory norms and issued beyond the limitation period prescribed by Section 11A(11).
The court established that suppression of facts for extending limitation requires deliberate intent to evade duty, not mere failure to act.
The extended period of limitation under Section 73(1) of the Finance Act cannot be invoked without clear evidence of fraud or suppression of facts; mere omissions do not justify such actions.
In cases of revenue disputes, undue delay in adjudication of show cause notices violates fundamental rights and regulatory statutes, rendering them invalid.
A mere non-payment of service tax does not justify invoking the extended limitation period unless there is evidence of deliberate intent to misstate or suppress facts.
Extended limitation period for tax demands requires evidence of deliberate suppression or intent to evade tax; mere non-payment is insufficient.
The main legal point established is that wilful mis-statement or suppression of facts with the intention to evade payment of duty must be proven for invoking the extended period of limitation under S....
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