Facts of the Case

The Commissioner of CGST and Central Excise Jammu filed the 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 Tribunal 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 refund direction was connected with 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 recorded that a batch of similar appeals had earlier been filed by the Commissioner, Central GST and Central Excise (Jammu and Kashmir), Jammu against CESTAT orders granting refund of the aforesaid cesses. Those appeals, together with applications seeking condonation of delay, had already been dismissed by a Coordinate Bench of the High Court by judgment dated 23 May 2022, with CEA No. 10/2022 as the lead case.

In the present appeal, the Court found that the challenged order was similar to those involved in the earlier batch of appeals and that the grounds raised were almost identical to grounds already dealt with by the Coordinate Bench.

Issues Involved

  1. Whether the Revenue’s appeal under Section 35G of the Central Excise Act, 1944 against the CESTAT order directing refund of Education Cess and Secondary & Higher Education Cess was liable to be entertained.
  2. Whether the present appeal raised any materially distinguishable issue from the batch of appeals already dismissed by the Coordinate Bench on 23 May 2022.
  3. Whether, for maintaining parity and consistency in judicial determination, the present appeal should also be dismissed on the same terms and conditions as the earlier judgment.
  4. Whether the CESTAT’s refund direction, arising in the context of the Supreme Court decision in M/s SRD Nutrients Pvt. Ltd. vs Commissioner of Central Excise, Guwahati, could be challenged afresh on grounds substantially identical to those already considered in the earlier batch.

Petitioner’s / Appellant’s Arguments

The appellant-Revenue challenged the CESTAT order under Section 35G of the Central Excise Act, 1944.

From the order, the challenge concerned the Tribunal’s decision setting aside the orders of the Commissioner (Appeals) and the Adjudicating Authority and directing refund of Education Cess and Secondary & Higher Education Cess to the assessee.

The Revenue’s challenge was on grounds that the High Court found to be almost identical to those already raised and dealt with in the earlier batch of appeals decided by the Coordinate Bench on 23 May 2022.

Important note: The short order does not separately reproduce detailed ground-wise submissions of the appellant. Therefore, no additional argument beyond what is recorded in the judgment should be attributed to the Revenue.

Respondent’s Arguments

The judgment records that none appeared for the respondent.

Accordingly, the order does not record any separate oral or written arguments advanced on behalf of M/s VMCO Alloys in the present proceedings.

The Court decided the appeal after examining its contents and comparing the challenge with the substantially similar matters already adjudicated by the Coordinate Bench.

Court Order / Findings

The High Court dismissed the Revenue’s appeal.

The Court specifically found that:

  • the present appeal challenged a similar order to those involved in the earlier batch of appeals;
  • the grounds raised were almost identical;
  • those grounds had already been dealt with by the Coordinate Bench in its judgment dated 23 May 2022; and
  • to maintain parity, the present appeal deserved dismissal on the same terms and conditions as laid down in that earlier judgment.

Accordingly, the High Court:

  • dismissed the appeal;
  • applied the same terms and conditions as contained in the Coordinate Bench judgment dated 23 May 2022; and
  • directed that any subsisting interim directions stood vacated.

This operative conclusion appears on page 2 of the uploaded order, where the Court expressly records that the appeal was dismissed to maintain parity with the earlier Coordinate Bench decision.

Important Clarification

The present order is materially significant because it is a parity-based dismissal. The High Court did not undertake a fresh, elaborate examination of every aspect of the cess-refund controversy in this two-page order. Instead, it found the challenged order and grounds to be substantially similar to those already considered by the Coordinate Bench and dismissed the appeal on the same terms and conditions.

Further, 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) because the CESTAT refund directions in the relevant matters had been made in view of that decision.

For accurate reporting, it should also be clarified that the respondent was not represented at the hearing, as the appearance column expressly records “None”.

The judgment does not independently reproduce or decide in detail every substantive proposition concerning the refund entitlement. Its immediate ratio rests on similarity with the earlier batch of appeals and the need to maintain parity.

Sections Involved

  • Section 35G of the Central Excise Act, 1944 – Statutory provision under which the Commissioner filed the appeal before the High Court against the CESTAT order.
  • Central Excise Act, 1944 – Principal enactment governing the appellate proceedings referred to in the order.
  • Education Cess provisions – Involved in the underlying refund dispute; however, the short High Court order does not specify a separate charging-section number for the cess.
  • Secondary & Higher Education Cess provisions – Involved in the underlying refund dispute; however, the short High Court order does not specify a separate charging-section number.

Link to download the order-https://mytaxexpert.co.in/uploads/1783158616_878compressed.pdf

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