Facts of the Case

The Commissioner of CGST & Central Excise (J&K), Jammu filed an appeal under Section 35G of the Central Excise Act, 1944 challenging an order of the Customs, Excise and Service Tax Appellate Tribunal, Chandigarh (“CESTAT”).

The dispute formed part of a broader set of similar matters in which the CESTAT had set aside orders passed by the Commissioner (Appeals) and the Adjudicating Authority and had directed refund of Education Cess and Secondary & Higher Education Cess to assessees by relying upon 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 comparable appeals filed by the Revenue, with CEA No. 10/2022 as the lead case, had already been dismissed by a Coordinate Bench through judgment dated 23 May 2022, along with applications seeking condonation of delay.

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 adjudication when almost identical grounds had already been considered by a Coordinate Bench.
  2. Whether the High Court should maintain parity with its earlier judgment dated 23 May 2022 concerning a batch of similar Revenue appeals.
  3. Whether the challenge to the CESTAT order could survive when the grounds raised were substantially similar to those already dealt with in the earlier batch judgment.

Appellant’s Arguments

The Commissioner of CGST & Central Excise (J&K), Jammu, represented by counsel, challenged the CESTAT order under Section 35G of the Central Excise Act, 1944.

From the order, the Revenue’s challenge concerned the CESTAT’s decision granting relief in relation to the refund of Education Cess and Secondary & Higher Education Cess. The appeal was based on grounds that the High Court found to be almost identical to those already considered and decided by the Coordinate Bench in the earlier batch of appeals.

The order does not separately reproduce detailed ground-wise submissions of the appellant beyond recording the nature of the challenge and its similarity with the earlier batch matters.

Respondent’s Arguments

The order records that none appeared for the respondent, M/s BBF Industries Ltd. (U-II).

Accordingly, no separate oral arguments or detailed submissions on behalf of the respondent are recorded in the order. The Court proceeded after examining the contents of the appeal and comparing the matter with the previously decided batch of similar appeals.

Court Order / Findings

The High Court examined the contents of the appeal and found that:

  • the challenge was directed against an order similar to those involved in the earlier batch of appeals;
  • the grounds raised were almost identical to the grounds already considered by the Coordinate Bench;
  • those grounds had already been dealt with in the judgment dated 23 May 2022; and
  • maintaining consistency and parity required the present appeal to receive the same treatment.

Accordingly, the High Court dismissed the appeal on the same terms and conditions as laid down in the Coordinate Bench judgment dated 23 May 2022.

The Court further ordered that any subsisting interim directions stood vacated.

Important Clarification

This order is significant because the High Court did not undertake a fresh detailed adjudication of the Education Cess refund controversy on merits. Instead, it expressly found that the present appeal involved a similar order and almost identical grounds already dealt with by the Coordinate Bench.

Therefore, the dismissal rests specifically on:

  • similarity with the earlier batch of appeals;
  • prior consideration of almost identical grounds;
  • the judgment dated 23 May 2022; and
  • the judicial requirement of maintaining parity.

It is also important that the present two-page order refers to M/s SRD Nutrients Pvt. Ltd. vs Commissioner of Central Excise, Guwahati as the Supreme Court decision in view of which CESTAT had directed refund in the underlying category of disputes. The High Court’s order should not be overstated as an independent, elaborate reconsideration of that Supreme Court precedent because no such detailed merits analysis appears in the present order.

Related Case Law in Detail

M/s SRD Nutrients Pvt. Ltd. vs Commissioner of Central Excise, Guwahati — 2017 (335) ELT 481 (SC)

The present High Court order expressly records that the CESTAT had directed refund of Education Cess and Secondary & Higher Education Cess to assessees in view of the Supreme Court decision in this case.

Thus, SRD Nutrients formed the stated judicial basis for the CESTAT’s refund approach in the category of disputes referred to by the High Court. However, the present order does not reproduce or independently analyse the complete ratio of the Supreme Court judgment; it records the precedent as the basis on which the CESTAT had granted refund relief.

Coordinate Bench Judgment dated 23 May 2022 — Lead Case CEA No. 10/2022

This was the directly controlling comparative precedent for disposal of the present appeal. The High Court recorded that a batch of Revenue appeals, with CEA No. 10/2022 as the lead case, had already been dismissed by a Coordinate Bench.

After finding that the present challenge concerned a similar order and almost identical grounds, the Court dismissed CEA No. 302/2022 on the same terms and conditions as the earlier judgment to maintain parity.

Section Involved

Section 35G of the Central Excise Act, 1944 — The provision under which the Commissioner filed the appeal before the High Court against the CESTAT order.

Link to download the order - 

https://mytaxexpert.co.in/uploads/1783320552_1110compressed.pdf 

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