2015 (4) TMI 850 - AT - Central Excise

Validity of the amending Notification 19/08-CE dt.27.3.08 and Notification 34/08-CE dt.10.6.08 - Refund claim - whether the appellant would be eligible for full refund of duty paid through PLA in the manner specified in this notification or whether this benefit of notification is restricted to the duty payable on the value addition at the rate specified in the exemption notification or duty paid form PLA in the manner specified in this notification, whichever is lower - Held that - High Court vide its order dated 12.4.2012 in respect of writ petition has ordered that --- implementation of the notification under challenge shall await the result of LPA as is pending judgement dated 23.12.2010 . In our view pending decision of LPA, the department cannot implement amending Notification 19/08-CE dt.27.3.08 and Notification 34/08-CE dt.10.6.08 which have been challenged by the appellant before the High Court. Therefore, appeal filed by the appellant against the Assistant Commissioner s order rejecting the refund claim, cannot be said to be premature. The Commissioner (Appeals) should have disposed of the appeals after decision of the LPA filed by the department against the High Court s judgement in the case of Reckitt Bencksier (India) Ltd. (2010 (12) TMI 237 - JAMMU AND KASHMIR HIGH COURT), and he should have kept the appeals pending till the decision of the LPA and he could not dismiss them as premature. - impugned order is set aside and the matter is remanded back to the Commissioner (Appeals) to decide the disputed refund claim of education cess and S&H cess in respect of the appellant s plea that they have not taken self-credit of education cess and S&H cess, therefore the question of its recovery does not arise. - Decided in favour of assessee.

Summary

Issues:
1. Eligibility for full refund of duty paid through PLA under exemption notification.
2. Exemption of education cess and secondary and higher secondary education cess.
3. Premature dismissal of appeal by Commissioner (Appeals) based on pending judgments.

Analysis:

Issue 1:
The appellant contended for a full refund of duty paid through PLA under the exemption notification, exceeding the cap specified by amending notifications. The dispute centered on whether the benefit of the notification is limited to duty payable on specified value addition or duty paid through PLA, whichever is lower. The appellant's refund claim exceeded the cap set by amending notifications, leading to a duty demand of Rs. 33,47,741.

Issue 2:
A secondary point of contention arose regarding the exemption of education cess and secondary and higher secondary education cess paid through PLA under the notification. The appellant claimed they did not take self-credit for these cess amounts, while the department argued otherwise, citing a credit of Rs. 2,63,949. The Commissioner (Appeals) did not provide a conclusive finding on this matter, dismissing the appeal prematurely based on pending judgments.

Issue 3:
The Commissioner (Appeals) dismissed the appeal prematurely, citing pending judgments related to the validity of amending notifications. The appellant had filed a writ petition challenging the validity of these notifications before the Jammu & Kashmir High Court. The High Court's order dictated that the implementation of the challenged notification should await the result of the pending judgment. The Tribunal found the dismissal premature, emphasizing that the appeals should have been kept pending until the decision of the LPA filed by the department against the High Court's judgment.

In conclusion, the Tribunal set aside the impugned order and remanded the matter back to the Commissioner (Appeals) for a decision on the disputed refund claim of education cess and secondary and higher secondary education cess. The Commissioner was directed to keep the issue pending until the decision of the LPA filed by the department against the High Court's judgment. Both appeals were disposed of accordingly.