2015 (11) TMI 464 - AT - Central Excise

Refund of education cess - area based exemption - whether the appellants are entitle for refund in respect of Education cess and Secondary and Higher Education Cess paid through cash under Notification No. 56/2002-CE dated 14/11/2002 - Held that - Education Cess is in nature of piggy back of duty which could not operate in respect of excise duty exempted under the relevant law. When the entitlement to exemption of duty of excise or additional duty of excise which would otherwise being payable under 3(x) in Notification No. 56/2002-CE is undisputed, no duty of education Cess arises in nature of excise duty under section 93 of Finance Act, 2004. Education cess not to be refunded as no provisions or it returns in notification ibid is not sustainable. In view of the above settled legal position, I am of the considered view that the appellant is entitle for the refund of education cess and secondary and higher education cess paid on clearances of the goods under Notification No. 56/2002-CE. Therefore orders in appeal are set aside - Decided in favour of assessee.

Summary

Issues involved:
1. Entitlement for refund of Education cess and Secondary and Higher Education Cess under Notification No. 56/2002-CE.

Detailed Analysis:
The appeals were against the Order-in-Appeal passed by the Commissioner (Appeals) Central Excise & Service Tax, Mumbai, where the issue was whether the appellants were entitled to a refund of Education cess and Secondary and Higher Education Cess paid through cash under Notification No. 56/2002-CE. The adjudicating authority rejected the refund claim, stating that the notification only exempted basic excise duty, not the mentioned cesses. The appellant cited a Tribunal judgment in a similar case, but the Commissioner (Appeals) dismissed the appeal, mentioning a pending SLP filed by the Revenue. The appellant contested this decision, highlighting that the Tribunal judgment should not be disregarded merely due to an SLP filing without a stay granted by the Supreme Court.

The Counsel for the appellant argued that the Commissioner erred in dismissing the appeal despite the Tribunal's favorable judgment in a similar case. The Revenue, represented by the Assistant Commissioner, requested to keep the appeals in abeyance due to the pending SLP. The Tribunal noted the burden of pending appeals and emphasized that the absence of a stay on the Tribunal's order in the Revenue's SLP did not justify withholding a decision. Referring to the Tribunal's past judgments, the Tribunal found that the Education cess was akin to a piggyback duty and should be refunded along with the basic excise duty under the notification. The Tribunal ruled in favor of the appellant, allowing the appeals and granting consequential relief.

In conclusion, the Tribunal held that the appellant was entitled to a refund of the Education cess and Secondary and Higher Education Cess paid under Notification No. 56/2002-CE. The Tribunal set aside the orders in appeal, aligning with previous judgments and legal interpretations, and allowed the appeals with appropriate relief as per the law.