Relief to Sun Pharma Laboratories Limited: CESTAT allows Refund for Education Cess and Higher Education Cess while Exempting Excise Duty [Read Order]

In a ruling in favour of Sun Pharma Laboratories Ltd , the Chandigarh  bench of the Customs, Excise And Service Tax Appellate Tribunal (CESTAT) allowed the refund for Education Cess and Higher Education Cess while exempting excise duty.

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 Sun Pharma Laboratories Limited, the appellant are engaged in manufacture of P&P Medicines falling under Tariff Heading

Nos. 30049099 & 30039090 of First Schedule to Central Excise Tariff Act, 1985. The appellant were operating under area based exemption Notification No. 56/2002-CE dated 14.11.2002. In these two appeals, demand has been raised by issuing show cause notices for recovery of refund claim rejected by the jurisdictional Central Excise officer on the ground of rejection of refund of education cess and secondary & higher education cess.

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The original authority confirmed the demand by holding that education cess and secondary & higher education cess are not duties of excise and therefore, for payment of education cess and secondary & higher education cess, CENVAT Credit of basic excise duty cannot be used. Aggrieved by the order of original authority, the appellant filed appeal before the Commissioner (Appeals), who has rejected their appeal.

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Consultant for the appellant submitted that the impugned order is not sustainable in law and is liable to be set aside as the same has been passed without properly appreciating the facts and the law and by ignoring the binding judicial precedents. On the other hand, the Authorized Representative for the Revenue reiterates the findings of the impugned order.

After considering the submissions made by both the parties and perusal of the material on record, we find that the issue involved in the instant case is no more res integra and has been settled in favour of the appellant in their own case for the previous period as cited supra.

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The Commissioner (Appeals) has rejected the appeal of the appellant by holding that the appellant are not entitled to refund of education cess and secondary & higher education cess.The tribunal found that the  Apex Court in the case of SRD Nutrients Pvt Ltd  which allowed the refund as the exemption was on the excise duty.

The two member bench of S. S. Garg, Member (Judicial) and  P. Anjani Kumar, Member (Technical) set aside the impugned order and allowed both the appeals of the appellant.

To Read the full text of the Order CLICK HERE

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