Education cess on paper cess rejected where the cess was not levied and collected by the Revenue Department.

Education cess was held not leviable on paper cess collected under the Industries (Development and Regulation) Act, 1951, because the base for education cess was confined to duties levied and collected by the Department of Revenue. The Tribunal relied on Board clarification and prior rulings on sugar cess and paper cess, treating the issue as settled that a cess imposed by a department other than the Ministry of Finance could not be included in the computation. The Revenue's appeal therefore failed.

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Issues: Whether education cess was leviable on paper cess collected under the Industries (Development and Regulation) Act, 1951.

Analysis: The dispute concerned calculation of education cess on paper cess. The Board's clarification was relied upon to the effect that education cess is leviable only on duties levied and collected by the Department of Revenue. The prior decisions dealing with sugar cess and paper cess were treated as covering the same legal question, namely whether a cess levied by a department other than the Ministry of Finance could form part of the base for education cess. The Tribunal also noted that the issue had already been decided in another case holding that paper cess was not to be taken into account while computing education cess.

Conclusion: Education cess was not chargeable on paper cess, and the Revenue's appeal failed.

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