2010 (7) TMI 327 - AT - Service Tax

Tribunal Upholds Denial of Education Cess Refund Under Notification No. 41/07-S.T.

BALASORE ALLOYS LTD. Versus COMMR. OF C. EX., CUS. & S. TAX, BBSR-I

The Tribunal dismissed the appeals, upholding the Commissioner (Appeals) order that denied the refund of education cess. The Tribunal ruled that since ... Refund of education cess - disallowed by the Commissioner (Appeals) - contention of appellant is that under the provisions of Notification No. 41/2007-S.T. dated 6-10-2007 there is an exemption from S. Tax on specified taxable service by way of refund - Held that: - There is no notification exempting the education cess by way of Refund under the Finance Act under which the education cess was levied - in absence of Notification granting exemption to the education cess, the same is not admissible - Appeal is dismissed Issues involved:Refund of education cess under Notification No. 41/2007-S.T. dated 6-10-2007.Analysis:1. Appellant's Contention:The appellant filed appeals against the Commissioner (Appeals) order disallowing the refund of education cess. The appellant argued that education cess, being part of Service Tax, should be refunded under Notification No. 41/2007-S.T. dated 6-10-2007. They cited precedents like Banswara Syntex Ltd. and Vipor Chemicals Pvt. Ltd. to support their claim.2. Revenue's Contention:The Revenue argued that, similar to a previous case concerning Jammu & Kashmir, education cess refund is not admissible without a specific exemption notification. They referred to Tribunal decisions in cases like Gitanjali Industries and Kamakhya Cosmetics & Pharma Pvt. Ltd. to support their stance. The Revenue also highlighted specific notifications like No. 18/07, indicating the intention to grant exemptions.3. Decision:The Tribunal found that the appellant sought exemption for education cess refund under Notification No. 41/07-S.T. dated 6th October, 2007, which only exempted Service Tax. Since there was no specific notification exempting education cess, similar to past cases like CCEx. v. Jindal Drugs Ltd., the Tribunal dismissed the appeals. They cited the precedent set by the Supreme Court in Union of India v. Modi Rubber Ltd. to support their decision, emphasizing the need for a specific exemption notification for education cess refunds.In conclusion, the Tribunal upheld the impugned orders, stating that in the absence of a notification granting exemption for education cess, the refund is not admissible. The appeals were dismissed based on the established legal principles and precedents cited in the judgment.