2013 (4) TMI 182 - AT - Central Excise

Refund claim - Area based exemption - Notification No. 56/2002-C.E. - The point of dispute is as to whether the education cess levied under Section 91 read with Section 93 of Finance Act, 2004 and Secondary and Higher Education Cess levied under Section 136 read with Section 138 of the Finance Act, 2007 are also covered by this exemption notification for duty exemption. - Held that - The issue involved in this case stands decided against the appellant by a detailed judgment of the Tribunal in the case of CCE, Jammu v. Jindal Drugs Ltd. reported in 2009 (8) TMI 812 - CESTAT, NEW DELHI wherein the Tribunal relying upon the Apex Court s judgment in the case of Union of India v. Modi Rubber Ltd. reported in 1986 (8) TMI 60 - SUPREME COURT OF INDIA had held that Notification No. 56/2002-C.E. is not applicable to education cess levied under Section 91 read with Section 93 of Finance Act, 2004. The appeal is dismissed.

Summary

Issues:
Whether education cess and Secondary and Higher Education Cess (S & H Cess) levied under specific sections of the Finance Act are covered by the exemption notification for duty exemption under Notification No. 56/2002-C.E.

Analysis:
The appellant, a manufacturing unit availing exemption under Notification No. 56/2002-C.E., disputed the disallowance of exemption for education cess and S & H cess by the Jurisdictional Assistant Commissioner. The Commissioner (Appeals) upheld this decision, citing a prior Division Bench judgment. The appellant argued that the exemption should cover these cesses based on Tribunal judgments and Board's instructions. The Respondent defended the decision, referencing similar judgments from other High Courts. The Tribunal noted conflicting Tribunal judgments but relied on the Apex Court's ruling in a related case to conclude that education cess and S & H cess are not covered by the exemption.

The Tribunal referenced the Apex Court's decision in Union of India v. Modi Rubber Ltd., emphasizing that the specific wording of Notification No. 56/2002-C.E. only exempts duties under certain Acts, excluding education cess. The Tribunal highlighted that previous Tribunal judgments did not consider this Apex Court ruling. Additionally, the Tribunal cited a High Court case to support the position that similar notifications do not cover education cess. The Tribunal concluded that there was no need to refer the issue to a Larger Bench based on the consistent legal interpretations. Ultimately, the Tribunal dismissed the appeal, affirming the decision to disallow exemption for education cess and S & H cess under Notification No. 56/2002-C.E.