2013 (5) TMI 63 - AT - Central Excise

Utilisation of credit of basic excise duty for discharge of Education Cess and Secondary and Higher Education Cess - Held that - in view of judgment of the Hon ble High Court of Gujarat in the case of Commissioner Central Excise Customs & Service Tax VAPI Versus M/S Madura Industries Textiles 2013 (1) TMI 352 demand set aside - appeal allowed - decided in favor of assessee.

Summary

Issues: Stay petition against waiver of pre-deposit of Cenvat Credit Disallowed, Penalty, and Interest amounts confirmed by lower authorities due to utilization of credit balance for Education Cess and Higher Education Cess.

Analysis:

1. The appellant filed a stay petition against the waiver of pre-deposit of certain amounts, including Cenvat Credit Disallowed, Penalty, and Interest. The lower authorities confirmed these amounts, alleging incorrect utilization of credit balance for Education Cess and Higher Education Cess. The appellant's Chartered Accountant referred to a previous Tribunal decision in Balaji Industries and a High Court judgment in Madura Industries Textiles, arguing that the utilization was lawful.

2. The Tribunal, after hearing both parties, noted that the appeal could be disposed of based on their previous view in Balaji Industries, which was upheld by the High Court in the Madura Industries Textiles case. Consequently, the Tribunal allowed the application for the waiver of pre-deposit and proceeded to address the appeal itself.

3. Upon reviewing the records, the Tribunal acknowledged the issue concerning the utilization of credit of basic excise duty for Education Cess and Higher Education Cess, as highlighted by the Chartered Accountant. The Tribunal observed that this issue was now definitively settled by the High Court judgment in the Madura Industries Textiles case, favoring the assessee.

4. Given that the issue was conclusively resolved in favor of the assessee by the High Court judgment, the Tribunal set aside the impugned order confirming the disputed amounts. The Tribunal allowed the appeal, thereby overturning the lower authorities' decision and ruling in favor of the appellant.

5. In conclusion, the Tribunal, having considered the legal precedents and the specific issue at hand, granted the waiver of pre-deposit and allowed the appeal based on the established interpretation of the law regarding the utilization of credit for Education Cess and Higher Education Cess, as clarified by the High Court judgment in the Madura Industries Textiles case.