Facts of the Case

The Commissioner of Central GST and Central Excise, Jammu and Kashmir, Jammu filed an appeal before the High Court under Section 35G of the Central Excise Act, 1994, challenging an order of the Customs, Excise and Service Tax Appellate Tribunal, Chandigarh.

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 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 recorded that a batch of similar appeals had earlier been filed by the Commissioner of Central GST and Central Excise, Jammu and Kashmir, under Section 35G against CESTAT orders granting such refunds. Those appeals, along with applications seeking condonation of delay, with CEA No. 10/2022 as the lead case, had already been dismissed by a Coordinate Bench through judgment dated 23 May 2022.

Issues Involved

The principal issues arising from the appeal were:

  1. Whether the Revenue’s challenge to the CESTAT order directing refund of Education Cess and Secondary & Higher Education Cess required separate adjudication when substantially similar appeals had already been decided by a Coordinate Bench.
  2. Whether the present appeal, involving a similar order and almost identical grounds, should be dismissed on the same terms and conditions as the earlier batch of appeals decided on 23 May 2022.
  3. Whether parity and consistency in judicial treatment required the present appeal to follow the earlier Coordinate Bench judgment.
  4. Whether the CESTAT’s refund direction, founded on the Supreme Court decision in M/s SRD Nutrients Pvt. Ltd. vs Commissioner of Central Excise, Guwahati, could be reopened through an appeal presenting grounds already dealt with in the earlier batch judgment.

Appellant’s Arguments

The Commissioner of Central GST and Central Excise J&K, Jammu challenged the CESTAT order under Section 35G of the Central Excise Act, 1994.

From the judgment, the Revenue’s challenge concerned an order similar to those involved in the earlier batch of appeals. The High Court specifically observed that the challenge was raised on almost identical grounds, which had already been dealt with by the Coordinate Bench in its judgment dated 23 May 2022.

The appeal therefore represented a Revenue challenge to the appellate tribunal’s relief concerning refund of Education Cess and Secondary & Higher Education Cess.

Respondent’s Arguments

The judgment records that none appeared for the respondent.

Accordingly, no separate oral submissions on behalf of M/s Gaurav Agro-Chem Industries are recorded in the judgment. The matter was decided by the High Court after examining the contents of the appeal and comparing it with the earlier batch of appeals already adjudicated by the Coordinate Bench.

Court Order / Findings

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

  • the challenged order was similar to the orders 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
  • judicial parity required the present matter to receive the same treatment.

Accordingly, with a view to maintain parity, 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 interim directions subsisting as on the date of judgment would stand vacated.

Important Clarification

This judgment is significant because the High Court did not undertake a fresh detailed adjudication of the underlying refund controversy on merits. Instead, the Court found that the present appeal challenged a similar order on almost identical grounds that had already been dealt with by a Coordinate Bench.

Therefore, the operative basis of dismissal was parity with the earlier judgment dated 23 May 2022.

It is also important that the judgment refers to M/s SRD Nutrients Pvt. Ltd. vs Commissioner of Central Excise, Guwahati, 2017 (335) ELT 481 (SC) as the Supreme Court decision in view of which CESTAT had directed refund of Education Cess and Secondary & Higher Education Cess. However, the High Court’s two-page judgment itself does not independently re-examine the entire substantive refund jurisprudence or pronounce a fresh detailed ratio on every aspect of the cess-refund controversy.

Section Involved

Section 35G of the Central Excise Act, 1994

The appeal before the High Court was filed under Section 35G against the CESTAT order. The judgment expressly records this statutory basis of the Revenue’s appeal.

Link to download the order -https://mytaxexpert.co.in/uploads/1783332633_1330compressed.pdf

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