2013 (5) TMI 321 - AT - Central Excise

Levy of cess - Benefit of Notification No. 56/2002 dated 14.11.2002 - Held that - In terms of the notification in question, there was no prohibition for levy and collection of education cess or higher education cess in respect of the levy and payment of excise duty and additional excise duty pertaining to the goods which are entitled for the exemption benefit under the said notification.There is no question of refund of education cess or higher education cess paid in the matter in hand by those who have availed the benefit under exemption Notification. Thus, the order passed by the Commissioner (Appeals) could not be sustained and is liable to be set aside and order passed by the original authority to be restored with all consequential results.

Summary

Issues:
Levy of cess in relation to excise duty and additional excise duty under a specific notification.

Analysis:
The judgment by the Appellate Tribunal CESTAT NEW DELHI, delivered by Mr. D.N. Panda, addressed the issue of levy of cess in the context of excise duty and additional excise duty under a particular notification. The appellant did not appear, and no adjournment application was made, leading to the matter being considered four years old and thus not worth keeping pending. With the consent of the DR, both appeals were taken up for hearing.

The learned DR, Shri Jain, argued that the levy of cess is no longer a matter in doubt. Referring to a previous batch of appeals where Revenue succeeded, it was highlighted that the notification in question did not exempt the liability of manufacturers to pay education cess or higher education cess. The notification was specific to certain enactments and did not relate to the imposition of education cess under the Finance Act of 2004 or 2007. Therefore, the order passed by the Commissioner (Appeals) was deemed unsustainable, and it was set aside in favor of the Revenue. Consequently, both appeals of the Revenue were allowed.

In conclusion, the judgment clarified the position regarding the levy of cess in connection with excise duty and additional excise duty under a particular notification. It emphasized that the exemption benefit under the said notification did not absolve manufacturers from paying education cess or higher education cess. The decision was based on the interpretation of the notification and its scope in relation to the imposition of various cess types, ultimately ruling in favor of the Revenue based on precedent and legal analysis.