Facts of the Case

The Commissioner of Central GST and Central Excise (Jammu and Kashmir), Jammu filed the present appeal under Section 35G of the Central Excise Act, 1944 against an order passed by the Customs, Excise and Service Tax Appellate Tribunal, Chandigarh.

The broader dispute arose from orders of the CESTAT whereby the Tribunal 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 the assessee in view of the decision of the Supreme Court in M/s SRD Nutrients Pvt. Ltd. v. 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 under Section 35G of the Central Excise Act, 1944 against CESTAT orders of different dates. Those appeals, together with applications seeking condonation of delay, had the lead matter CEA No. 10/2022 and had already been dismissed by a Coordinate Bench of the High Court through judgment dated 23 May 2022.

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 raised on almost identical grounds that had already been dealt with by the Coordinate Bench in its judgment dated 23 May 2022.

Accordingly, to maintain parity, the High Court dismissed the present appeal on the same terms and conditions as laid down in the earlier Coordinate Bench judgment. Any subsisting interim directions were also vacated.

Issues Involved

The principal issues arising from the judgment were:

  1. Whether the departmental appeal filed 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 substantially similar appeals had already been decided by a Coordinate Bench.
  2. Whether the challenge raised by the Revenue involved grounds materially different from those considered in the earlier batch of appeals decided on 23 May 2022.
  3. Whether, in order to maintain judicial parity and consistency, the present appeal should be disposed of on the same terms and conditions as the earlier Coordinate Bench judgment.
  4. Whether the CESTAT’s refund direction, arising in the context of the Supreme Court decision in M/s SRD Nutrients Pvt. Ltd. v. Commissioner of Central Excise, Guwahati, could sustain against the Revenue’s challenge in the circumstances recorded by the High Court.

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, 1944.

From the judgment, the departmental challenge formed part of the same class of disputes in which CESTAT had set aside orders of the Commissioner (Appeals) and the Adjudicating Authority and directed refund of Education Cess and Secondary & Higher Education Cess to assessees in view of the Supreme Court ruling in M/s SRD Nutrients Pvt. Ltd. v. Commissioner of Central Excise, Guwahati.

However, the High Court specifically found that the present appeal challenged a similar order on almost identical grounds that had already been dealt with by the Coordinate Bench in the earlier judgment dated 23 May 2022.

Important accuracy note: The short two-page judgment does not separately reproduce or elaborate each legal submission advanced by the appellant. Therefore, no additional argument beyond what is reflected in the judgment should be attributed to the Revenue.

Respondent’s Arguments

The judgment records that none appeared for the respondent, M/s Gaurav Agro-Chem Industries.

Accordingly, the judgment does not set out any separate oral or written submissions advanced on behalf of the respondent in the present proceedings.

The case was decided by the High Court after examining the contents of the appeal and comparing the nature of the challenge with the earlier batch of appeals already decided by the Coordinate Bench.

Important accuracy note: Since the judgment expressly records “None” for the respondent’s appearance, no independent respondent argument should be invented or inferred beyond the case background appearing in the judicial order.

Court Order / Findings

The High Court made the following material findings:

  • A batch of earlier appeals had been filed by the Commissioner of Central GST and Central Excise under Section 35G of the Central Excise Act, 1944 against CESTAT orders involving refund of Education Cess and Secondary & Higher Education Cess.
  • Those earlier appeals, with CEA No. 10/2022 as the lead case, had already been dismissed by a Coordinate Bench through judgment dated 23 May 2022.
  • Upon examining the present appeal, the Court found that the challenge was against a similar order to those involved in the earlier batch.
  • The grounds raised in the present appeal were found to be almost identical to the grounds already considered and dealt with by the Coordinate Bench.
  • The Court considered it appropriate to maintain parity with the earlier decision.
  • Consequently, the appeal was dismissed on the same terms and conditions as laid down in the Coordinate Bench judgment dated 23 May 2022.
  • Any interim directions subsisting as on the date of judgment were ordered to stand vacated.

Important Clarification

This judgment is a short parity-based disposal and should be understood with precision.

The High Court did not undertake a fresh, detailed examination in this order of every substantive legal issue concerning refund of Education Cess and Secondary & Higher Education Cess. Instead, it found that the present appeal concerned a similar order and almost identical grounds already dealt with by a Coordinate Bench.

Therefore, the operative basis of dismissal was:

similarity of the challenged order + almost identical grounds + prior Coordinate Bench adjudication + maintenance of parity.

Further, although the judgment refers to the Supreme Court ruling in M/s SRD Nutrients Pvt. Ltd. v. Commissioner of Central Excise, Guwahati, 2017 (335) ELT 481 (SC) as the decision in view of which CESTAT had directed refund, the present High Court order itself does not contain an independent, detailed reconsideration of the entire substantive jurisprudence governing such cess refunds.

It is also important that the judgment refers to the earlier Coordinate Bench judgment dated 23 May 2022 but does not, within this two-page order, reproduce the complete reasoning or all terms and conditions of that earlier judgment. Therefore, the present order should not be expanded beyond what the Court expressly recorded.

Sections / Legal Provisions Involved

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

Education Cess — The refund component forming part of the underlying dispute.

Secondary & Higher Education Cess — The additional cess refund component forming part of the underlying dispute.

Appellate jurisdiction over CESTAT orders — The present proceedings arose from a challenge to the Tribunal’s order before the High Court under Section 35G.

Link to download the order -https://mytaxexpert.co.in/uploads/1783407638_1351compressed.pdf

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