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 passed by the Customs, Excise and Service Tax Appellate Tribunal, Chandigarh (CESTAT).

The dispute arose from the CESTAT’s decision setting aside the orders passed by the Commissioner (Appeals) and the Adjudicating Authority and directing refund of Education Cess and Secondary & Higher Education Cess to the assessee.

The refund direction was based on the decision of the Supreme Court in M/s SRD Nutrients Pvt. Ltd. vs Commissioner of Central Excise, Guwahati, reported as 2017 (335) ELT 481 (SC).

The High Court recorded that a batch of similar appeals had already been filed by the Commissioner under Section 35G against CESTAT orders involving refund of the same cesses. Those appeals, together with applications seeking condonation of delay and 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 CESTAT order directing refund of Education Cess and Secondary & Higher Education Cess to the assessee was liable to be interfered with in an appeal under Section 35G of the Central Excise Act, 1994.
  2. Whether the present appeal raised grounds materially different from those already considered and decided by the Coordinate Bench in the earlier batch of similar appeals.
  3. Whether, to maintain parity and consistency in judicial decisions, the present appeal should be dismissed on the same terms and conditions as the earlier batch decided on 23 May 2022.

 

Appellant’s Arguments

The appellant, 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 challenge concerned the Tribunal’s decision to set aside the orders of the Commissioner (Appeals) and the Adjudicating Authority and to direct refund of Education Cess and Secondary & Higher Education Cess to the assessee.

However, the High Court specifically observed that the challenge in the present appeal was to a similar order and was founded on almost identical grounds to those already considered and dealt with by the Coordinate Bench in the earlier batch of appeals.

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

 

Respondent’s Arguments

The respondent, M/s Cadila Pharmaceuticals Ltd., was represented by Senior Advocate Mr Pranav Kohli along with Mr Farhan Mirza, Advocate.

The underlying position supporting the respondent was the CESTAT direction granting refund of Education Cess and Secondary & Higher Education Cess, in view of the Supreme Court decision in M/s SRD Nutrients Pvt. Ltd. vs Commissioner of Central Excise, Guwahati, 2017 (335) ELT 481 (SC).

The High Court found that the controversy and grounds involved were substantially identical to those already decided by the Coordinate Bench.

Important note: The judgment does not separately record detailed, proposition-wise oral or written arguments advanced by the respondent. Accordingly, the respondent’s submissions should not be expanded beyond the contents expressly reflected in the order.

 

Court Order / Findings

The High Court examined the contents of the appeal and recorded the following key findings:

  • The present appeal challenged an order similar to those involved in the earlier batch of appeals.
  • The grounds raised were almost identical to the grounds already dealt with by the Coordinate Bench.
  • The Coordinate Bench had already dismissed the earlier batch of appeals through its judgment dated 23 May 2022.
  • In order to maintain parity, the High Court dismissed the present appeal on the same terms and conditions as laid down in the judgment dated 23 May 2022.
  • Any interim directions subsisting as on the date of the judgment were ordered to stand vacated.

Important Clarification

This judgment is significant for the following reasons:

  • The High Court did not undertake a fresh elaborate determination of the refund controversy in isolation.
  • The dismissal was expressly based on the fact that a Coordinate Bench had already dealt with almost identical grounds in an earlier batch of appeals.
  • The Court applied the principle of parity and consistency and dismissed the appeal on the same terms and conditions as the judgment dated 23 May 2022.
  • The judgment 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 CESTAT had directed refund.
  • The order should not be overstated as containing an independent, detailed reconsideration of every legal proposition concerning cess refund; rather, the High Court’s operative reasoning rested on the prior Coordinate Bench decision covering substantially identical grounds.
  • The uploaded order consists of two pages: page 1 records the statutory appeal under Section 35G, the cess-refund background and the reliance on SRD Nutrients; page 2 records the parity finding, dismissal of the appeal and vacation of interim directions.

 

Sections / Legal Provisions Involved

Section 35G of the Central Excise Act, 1994 – Appeal to the High Court against qualifying orders of the Appellate Tribunal, subject to the statutory requirements governing such appeals.

Education Cess and Secondary & Higher Education Cess – The substantive refund dispute concerned the assessee’s entitlement to refund of these cesses.

 

Link to Download the Order-Download the Order – Commissioner of Central GST and Central Excise J&K, Jammu vs M/s Cadila Pharmaceuticals Ltd.

 

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