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TMI Blog2019 (6) TMI 1192X X X X Extracts X X X X X X X X Extracts X X X X ..... rgy Cess in the present case is not actually a duty, it is an additional amount as that of a fee for a specific purpose that Section 3, CCR,2004 will not be applicable. Otherwise also, Section 3 applies only to the duty of excise specified either in First Schedule to Excise Tariff Act or the Second Schedule thereto. In addition to other additional duties, as mentioned in Clause (iii) to (vii) as discussed. CEC does not fall in any of those sub-Clauses. Thus, the clean energy cess being actually in the nature of fee and not tax/ excise duty that the appellant is not entitled for availing cenvat credit thereupon - appeal dismissed - decided against appellant. - Excise Misc. Application No. 50123 of 2019 in Excise Appeal No. 52864 of 2018, - FINAL ORDER No. 50793/2019 - Dated:- 24-6-2019 - MR. BIJAY KUMAR, MEMBER (TECHNICAL) AND MR. RACHNA GUPTA, MEMBER (JUDICIAL) Shri V.A. Rana, Advocate for the Appellant Shri R.K. Maji, Authorised Representative for the Respondent ORDER The present Appeal has been preferred against the Order-in-Original No. 8 dated 12.06.2018 vide which the cenvat credit availed amounting to ₹ 54,43,40,872 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant has impressed upon the bonafide belief of the appellant that clean energy cess paid by them at the time of procurement of coal is in the nature of excise duty only and as such they are eligible for availing cenvat credit thereupon. The Order under challenge has ignored the same despite acknowledging the factum of the impugned cess to be in the nature of duty of excise. Hence, it is alleged that Order has legal infirmity, accordingly is liable to be set aside. Appeal is therefore prayed to be allowed. 5. While rebutting these arguments, it is submitted on behalf of the Department that the clean energy cess on coal, irrespective of being collected as duty of excise, is not specified as duty for availing cenvat credit under Rule 3 of CCR, 2004. Impressing upon paragraphs 13, 17 and 19 of the impugned Order, it is mentioned that the Adjudicating Authority below has rightly formed an opinion that though the impugned cess is in the nature of excise duty, it does not explicitly form the part of Excise Act. Hence the cess levied under any other Act than Excise Act does not find its way in the list of duties eligible for cenvat credit. The availment of impugned credit has ri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ral Excise Act, 1944, relating to levy of and exemption from duty of excise, refund, offences and penalties, confiscation and procedure relating to offences and appeals shall, with such modifications and alterations as it may consider necessary, be applicable in respect of cess levied under sub-section (3). 6.1.3 The perusal shows that the clean energy cess: (i) Is a duty of Excise. (ii) On the goods specified in 10th Schedule. (iii) Levied with the object of financing and promoting clean energy initiative funding research in the area of clean energy or for any other purpose relating thereto. (iv) Shall first be credited to consolidated fund of India. (v) Shall be utilised by Central Government for the purposes as mentioned in sub-Section 3/ Clause 4 above. (vi) The cess shall be in addition to any cess or duty leviable on the goods specified in 10th Schedule. (vii) It shall be for the purposes of Union and proceeds thereof shall not be distributed among the States. (viii) Provisions of Central Excise Act, 1944 shall be applicable as far as levy of exemption from duty, refund, offences and pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x from a Fee. It is true that between a tax and a fee there is no generic difference. Both are compulsory exactions of money by public authorities; but whereas a tax is imposed for public purposes and is not, and need not, be supported by any consideration of service rendered in return, a fee is levied essentially for services rendered and as such there is an element of quid pro quo between the person who pays the fee and the public authority which imposes it. If specific services are rendered to a specific area or to a specific class of persons or trade or business in any local area, and as a condition precedent for the said services or in return for them cess is levied against the said area or the said class of persons or trade or business the cess is distinguishable from a tax and is described as a fee. Tax recovered by public authority invariably goes into the consolidated fund which ultimately is utilised for all public purposes, whereas a cess levied by way of Fee is not intended to be, and does not become, a part of the consolidated fund. It is earmarked and set apart for the purpose of services for which it is levied. It was further held that, It is true ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fee lies primarily in the fact that a tax is levied as part of a common burden, while a fee is for payment of a specific benefit or privilege although the special advantage is secondary to the primary motive of regulation in public interest. If the element of revenue for general purpose of State predominates, the levy becomes a tax. In regard to fees there is, and must always be, correlation between the fee collected and the service intended to be rendered. In determining whether a levy is a fee, the true test must be whether its primary and essential purpose is to render specific services to a specified area of class; it may be of no consequence that the State may ultimately and indirectly be benefited by it. The power of any legislature to levy a fee is conditioned by the fact that it must be by and large a quid pro quo for the services rendered. However, correlationship between the levy and the services rendered (sic or) expected is one of general character and not of mathematical exactitude. All that is necessary is that there should be a reasonable relationship between the levy of the Fee and the services rendered. 21. From the aforesaid judgments it is clear tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rposes. There was no quid pro quo between the cess levied and collected and the services referred for such payment on the contrary for clean energy cess, the proceeds though are credited to Consolidated Fund of India but for being utilised for a specific purpose as that of clean energy initiative, as a quid pro quo. 8. Rule 3 of CCR, 2004 is applicable only when it is established that what is paid is excise duty or in other words a tax and it is in that case only that the assessee is entitled to cenvat credit. 9. In view of the entire above discussion, we hereby conclude that CEC in the present case is not actually a duty, it is an additional amount as that of a fee for a specific purpose that Section 3, CCR,2004 will not be applicable. Otherwise also, Section 3 applies only to the duty of excise specified either in First Schedule to Excise Tariff Act or the Second Schedule thereto. In addition to other additional duties, as mentioned in Clause (iii) to (vii) as discussed. CEC does not fall in any of those sub-Clauses. Further, the Notification No.26/2010-CE dated 29.06.2010 has incorporated a proviso in Rule 3, CCR, 2004 which reads as follows: Provide ..... X X X X Extracts X X X X X X X X Extracts X X X X
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