2018 (12) TMI 374 - HC - Central Excise

Refund of education cess and the higher education cess paid - area based exemption availed - North East Industrial Policy of 1997 - Held that - In view of the consensus reached between the parties, this Court directs the respondents in the Department of Excise/Goods and Services Tax of the Government of India, more particularly the respondent Nos. 4 to 6 to make an appropriate calculation and thereupon refund the education cess and the higher education cess paid by the petitioner from July, 2004 to February, 2015 - the aforesaid process of refund be undertaken and completed, leading to refund of the education and higher education cess, within a period of 05(five) months from the date of receipt of a certified copy of this order - petition disposed off.

Summary

Issues:
Claim for refund of education cess and higher education cess under North East Industrial Policy of 1997.

Analysis:
The petitioner, an industrial unit in Assam, sought benefits under the North East Industrial Policy of 1997, including exemption from excise duty. The policy granted exemptions to units commencing production after 24.12.1997 or undergoing substantial expansion post that date. The Finance Act of 2004 imposed education cess and higher education cess in addition to excise duty. The petitioner claimed a refund of excise duty paid under the policy and the cesses paid as well.

The main issue revolved around whether the education cess and higher education cess were subject to refund under the North East Industrial Policy of 1997, akin to excise duty. The Supreme Court, in a previous judgment, held that these cesses, being levied as a percentage of excise duty, would be treated as excise duty itself. Consequently, if excise duty was exempted, the cesses would also be refundable.

Citing the Supreme Court's ruling, the petitioner sought a refund of education cess and higher education cess paid between July 2004 and February 2015, as per specific notifications. The authorities, represented by the ASGI, acknowledged the obligation to refund these cesses based on the Supreme Court's decision. Referring to a similar case in Meghalaya High Court, where parties agreed to refund the cesses, the court directed the authorities to calculate and refund the education cess and higher education cess paid by the petitioner within five months.

The court disposed of the writ petition, instructing the authorities to complete the refund process within the stipulated timeframe. This judgment highlights the interpretation of excise duty, education cess, and higher education cess under the North East Industrial Policy of 1997, emphasizing the refund entitlement based on legal precedents and specific notifications.