2014 (3) TMI 871 - AT - Central Excise

Waiver of pre deposit - Interpretation of Section 93 of the Finance Act, 2004 - Assessee contends that cement cess and dolomite cess have been levied not by the Ministry of Finance (Department of Revenue) but by the Ministry of Industrial Development and Ministry of Labour respectively. Therefore said amount of cess could not have been added to the aggregate amount for the purpose of calculation of education cess - Held that - on prima facie reading of Section 93 we find that there is merit in the submission made by the learned Counsel for the appellant. Accordingly, we hold that it is a fit case for waiver of the condition of pre-deposit of duty, interest and penalty - Stay granted.

Summary

Issues:
Interpretation of Section 93 of the Finance Act, 2004 regarding the calculation of education cess based on duties of excise; Whether cement cess and dolomite cess levied by Ministries other than the Ministry of Finance (Department of Revenue) should be included in the aggregate amount for education cess calculation.

Analysis:
The appellant sought waiver of the pre-deposit condition of duty, interest, and penalty confirmed by the impugned order-in-appeal, highlighting the interpretation of Section 93 of the Finance Act, 2004. The appellant's counsel argued that education cess should be calculated at 2% of duties of excise levied and collected by the Central Government in the Ministry of Finance under the Central Excise Act, 1944 or any other law. It was contended that since cement cess and dolomite cess were levied by Ministries other than the Ministry of Finance, they should not be included in the aggregate amount for education cess calculation, making the impugned order legally unsustainable.

The Department's representative, on the other hand, supported the impugned order. Upon considering the submissions, the Tribunal focused on interpreting the notification issued by the Ministry of Industrial Development and Ministry of Labour alongside Section 93 of the Finance Act, 2004. The Tribunal acknowledged the merit in the appellant's argument, finding that prima facie, the inclusion of cement cess and dolomite cess in the education cess calculation might not be correct as per the provisions. Consequently, the Tribunal held it to be a suitable case for waiving the pre-deposit condition of duty, interest, and penalty. The stay application was allowed, leading to the waiver of the pre-deposit condition and the suspension of recovery pending the appeal.

The Tribunal directed the appeal to be listed in due course for further proceedings, indicating a favorable stance towards the appellant's interpretation of the legal provisions and granting relief by waiving the pre-deposit condition based on the specific circumstances and arguments presented during the hearing.