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The issue involves the levy of Education Cess on basic customs duty debited in DEPB Scrip for clearance of goods under Duty Entitlement Pass Book (DEPB) scheme. Summary: The appeal arose from Order-in-Appeal confirming the levy of Education Cess on duty-free goods cleared under DEPB scheme. The Revenue contended that goods exempted from basic customs duty are not exempt from Education Cess. The appellant argued that a similar issue was considered by the Mumbai Bench, where it was held that no Education Cess is leviable on fully exempted DEPB imports. The appellant relied on a Board Circular and the provisions of Finance Act, 2004 to support their case. The JDR reiterated the departmental view supporting the levy of Education Cess on the goods. After careful consideration, the Tribunal referred to the Mumbai Bench's decision in the case of CCE vs. Reliance Industries Ltd., where it was held that Education Cess is not leviable on exempted DEPB imports. Following this precedent, the impugned order was set aside, and the appeal was allowed with consequential relief.
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