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2023 (3) TMI 1456 - AT - CustomsRequirement to pay education cess, higher secondary education cess and social welfare surcharge through cash payment - appellant had debited education cess, higher secondary education cess and social welfare surcharge from the duty credit scrip - HELD THAT - Hon ble High Court of Madras in the case of M/S. KTV HEALTH FOOD PVT. LTD. VERSUS THE COMMISSIONER OF CUSTOMS (PREVENTIVE) , TIRUCHIRAPALLI 2021 (10) TMI 119 - MADRAS HIGH COURT has applied CBIC circular No. 02/2020-Customs dated 10.01.2020 for non-recovery of education cess, and higher secondary education cess and requested to follow the said ruling and allow the appeal. In view of the ruling by Hon ble Madras High Court, the benefits conferred under clause 11 of circular No. 02/2020- Customs dated 10.01.2020 applied to education cess and higher secondary education cess. In the result the confirmation of demand in both the Order-in-Original is set aside. Appeal allowed.
Issues:
1. Interpretation of Circular No. 02/2020-Customs regarding payment of education cess, higher secondary education cess, and social welfare surcharge in duty credit scrip under the Merchandise Exports from India Scheme (MEIS). Comprehensive Analysis: The case involved two appeals concerning the debiting of education cess, higher secondary education cess, and social welfare surcharge from duty credit scrips issued under the Merchandise Exports from India Scheme (MEIS). The original authority had ordered the appellants to pay education cess and higher secondary education cess in cash, but dropped the demand for social welfare surcharge based on Circular No. 02/2020-Customs. The appellants appealed this decision before the Tribunal, arguing that the circular should also apply to education cess and higher secondary education cess. The appellant's counsel referred to a judgment by the Hon'ble Madras High Court in a similar case, where the court applied the circular for non-recovery of education cess and higher secondary education cess. The learned AR supported the impugned order, leading the Tribunal to carefully examine the case records and submissions. The Tribunal referenced the Madras High Court judgment, which emphasized that the circular's benefit should not be denied based on technical distinctions between different components. The Madras High Court quashed the impugned order and directed the respondent to provide the benefit of the circular to the petitioner. In light of this ruling, the Tribunal applied the benefits of the circular to education cess and higher secondary education cess, ultimately setting aside the confirmation of demand in both appeals and allowing them based on the Madras High Court's decision. In conclusion, the Tribunal's decision was influenced by the legal interpretation provided by the Madras High Court regarding the application of Circular No. 02/2020-Customs to education cess and higher secondary education cess, leading to the allowance of the appeals and the setting aside of the demands for cash payment of these cess components. (Order dictated and pronounced in open court)
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