2017 (5) TMI 378 - AT - Customs

Import of steam coal - whether central excise education cess and excise secondary and higher secondary cess is available in terms of exemption N/N. 28/2010 and 29/2010? - Held that - identical issue has come up before the Tribunal in the case of Singareni Collieries Co. Ltd. Vs. CCE, Hyderabad-II 2016 (8) TMI 1112 - CESTAT HYDERABAD , where it was held that exemption from E. Cess and S.H.E. Cess under Notifications No. 28 and 29/2010 both dated 22.06.2010 is applicable only with respect to Clean Energy Cess levied under the Finance Act, 2010, but will not be applicable with respect to Central Excise duty levied on coal w.e.f 01.03.2011 - demand upheld - penalty set aside - appeal allowed - decided partly in favor of Revenue.

Summary

Issues:
- Interpretation of notifications regarding exemption from Education Cess and Secondary & Higher Education Cess on excisable goods.
- Applicability of exemption on Central Excise duty levied on coal.
- Comparison with previous judgments on similar issues.
- Decision on penalty imposition.

Interpretation of Notifications:
The case involved the interpretation of notifications related to the exemption from Education Cess and Secondary & Higher Education Cess on excisable goods. The respondents were engaged in manufacturing excisable goods and importing steam coal. The notifications exempted steam coal from basic customs duty and CVD but did not address the exemption from central excise education cess and secondary and higher secondary cess. The issue arose when the respondents did not pay these cess amounts, relying on previous notifications. The Tribunal analyzed the notifications and relevant provisions to determine the scope of exemption and concluded that the exemption did not apply to central excise duty levied on coal.

Applicability on Central Excise Duty:
The Tribunal referred to a previous judgment involving a similar issue and highlighted the changes introduced through the Finance Bill, 2015. The Tribunal emphasized that the exemption from Education Cess and Secondary & Higher Education Cess was specific to clean energy cess levied on coal and did not extend to central excise duty on coal. The Tribunal cited circulars and notifications to support its interpretation, clarifying that the exemption under previous notifications was limited to clean energy cess and not applicable to excise duty on coal. Therefore, the Tribunal ruled in favor of the Revenue, upholding the show-cause demand.

Comparison with Previous Judgments:
The Tribunal compared the current case with the judgment in the case of Singareni Collieries Co. Ltd. The Tribunal noted the legislative changes introduced through the Finance Bill, 2015, which impacted the exemption from Education Cess and Secondary & Higher Education Cess on all excisable goods. By analyzing the provisions and circulars, the Tribunal affirmed that the exemption under previous notifications did not encompass excise duty on coal. The Tribunal's decision aligned with the findings in the previous judgment, leading to the dismissal of the appeals filed by the respondents.

Penalty Imposition Decision:
While setting aside the impugned order, the Tribunal found no justification for the imposition of a penalty. Therefore, the penalty was set aside, but the show-cause demand was upheld. The appeal filed by the Department was partially allowed based on the Tribunal's interpretation of the notifications and relevant legal provisions. The Tribunal pronounced and dictated the order in open court, concluding the legal proceedings in this case.