Facts of the Case

The Commissioner of CGST and Central Excise Jammu filed an appeal before the High Court of Jammu & Kashmir and Ladakh at Jammu under Section 35G of the Central Excise Act, 1944.

The dispute arose from an order passed by the Customs, Excise and Service Tax Appellate Tribunal, Chandigarh (CESTAT). The broader category of disputes concerned orders whereby the CESTAT had set aside the orders passed by the Commissioner (Appeals) and the Adjudicating Authority and had directed refund of Education Cess and Secondary & Higher Education Cess to the assessee.

The uploaded order records that such refund directions had been issued in view of the decision of the Supreme Court in M/s SRD Nutrients Pvt. Ltd. vs Commissioner of Central Excise, Guwahati, 2017 (335) ELT 481 (SC).

The High Court further recorded that a batch of similar appeals had earlier been filed by the Commissioner, Central GST and Central Excise (Jammu and Kashmir), Jammu under Section 35G of the Central Excise Act, 1944. Those appeals, together with applications seeking condonation of delay, had been dismissed by a Coordinate Bench through judgment dated 23 May 2022, with CEA No. 10/2022 being the lead case.

In the present matter, the High Court examined the contents of the appeal and found that the challenge was directed against a similar order and was based on almost identical grounds that had already been dealt with by the Coordinate Bench in its judgment dated 23 May 2022.

Issues Involved

The principal issues arising from the order were:

  1. Whether the Revenue’s appeal under Section 35G of the Central Excise Act, 1944 against the CESTAT order concerning refund of Education Cess and Secondary & Higher Education Cess required separate consideration when a batch of similar appeals had already been dismissed by a Coordinate Bench.
  2. Whether the challenge raised in the present appeal was materially distinguishable from the earlier batch of appeals decided on 23 May 2022.
  3. Whether judicial parity required dismissal of the present appeal on the same terms and conditions as the earlier Coordinate Bench judgment.
  4. Whether any subsisting interim directions should continue after dismissal of the appeal.

Appellant’s Arguments

The appellant, Commissioner of CGST and Central Excise Jammu, challenged the similar CESTAT order under Section 35G of the Central Excise Act, 1944.

From the express contents of the uploaded order, the challenge was on grounds that the High Court found to be almost identical to those already considered and dealt with by the Coordinate Bench in the earlier batch of appeals.

The order places the present appeal within the same category of disputes involving CESTAT decisions that set aside orders of the Commissioner (Appeals) and the Adjudicating Authority and directed refund of Education Cess and Secondary & Higher Education Cess to the assessee in view of M/s SRD Nutrients Pvt. Ltd. vs Commissioner of Central Excise, Guwahati.

Important accuracy note: The brief order does not separately reproduce a detailed proposition-by-proposition statement of the Revenue’s submissions. Therefore, no additional argument beyond what is expressly reflected in the judicial order should be attributed to the appellant.

Respondent’s Arguments

The respondent was M/s Cadila Pharmaceuticals Ltd., IGC, Samba, Jammu.

The appearance portion of the order records “None” for the respondent. Accordingly, the uploaded order does not record any separate oral or written arguments advanced on behalf of the respondent at the hearing reflected in the order.

The matter was therefore decided by the High Court after considering the contents of the appeal and the binding relevance of the earlier Coordinate Bench decision concerning substantially similar challenges.

Court Order / Findings

The High Court made the following material findings:

  1. A batch of appeals had previously been filed under Section 35G of the Central Excise Act, 1944 against CESTAT orders involving refund of Education Cess and Secondary & Higher Education Cess.
  2. Those appeals, along with applications for condonation of delay, had already been dismissed by a Coordinate Bench through judgment dated 23 May 2022.
  3. Upon examining the present appeal, the Court found that the challenge was directed against a similar order.
  4. The grounds raised in the present appeal were found to be almost identical to those already dealt with by the Coordinate Bench.
  5. The High Court considered it appropriate to maintain parity with the earlier decision.
  6. Consequently, the Court dismissed the appeal on the same terms and conditions as laid down in the judgment dated 23 May 2022 passed by the Coordinate Bench.
  7. The Court further directed that any interim direction(s), if subsisting as on the date of the order, would stand vacated.

The operative conclusion appearing on page 2 of the uploaded order is therefore that the Revenue appeal was dismissed to maintain parity with the earlier Coordinate Bench judgment.

Important Clarification

This order is significant for the following precise reasons:

  • The High Court did not undertake a fresh elaborate examination of the entire Education Cess refund controversy in this short order.
  • The dismissal was expressly based on the fact that a similar order had been challenged on almost identical grounds already dealt with by a Coordinate Bench.
  • The controlling procedural and judicial consideration expressly stated by the Court was the need “to maintain parity.”
  • The present appeal was dismissed on the same terms and conditions as the Coordinate Bench judgment dated 23 May 2022.
  • Any subsisting interim directions were expressly vacated.
  • The order refers to the Supreme Court ruling in M/s SRD Nutrients Pvt. Ltd. vs Commissioner of Central Excise, Guwahati, 2017 (335) ELT 481 (SC) as the decision in view of which the CESTAT had directed refund in the relevant category of matters.
  • The uploaded order itself does not provide the case title or full reasoning of the lead matter CEA No. 10/2022 beyond identifying it as the lead case in the earlier batch. Therefore, further particulars should not be inferred from this short order alone.

Sections Involved

Section 35G of the Central Excise Act, 1944 — The statutory provision under which the Revenue appeals were filed before the High Court against orders of the Appellate Tribunal, subject to the statutory framework governing such appeals.

Education Cess and Secondary & Higher Education Cess — The substantive refund components forming the background of the dispute described in the judicial order.

Link to download the order-https://mytaxexpert.co.in/uploads/1783157005_873compressed.pdf

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