Refund and self-credit of cess linked to duty paid through PLA were allowed after restrictive notifications were quashed.

Education cess and higher education cess paid through PLA were treated as a continuation of duty, so where refund or self-credit of the underlying duty under Notification No. 56/2002-CE was admissible, the corresponding cess component was also admissible. The discussion further notes that restrictions introduced by Notification No. 19/2008-CE and Notification No. 34/2008-CE could not be applied once the supporting High Court ruling had quashed those limitations. On that basis, the refund or self-credit claim for duty paid through PLA, including cess, was allowed.

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Issues: (i) Whether the assessee was entitled to refund or self-credit of education cess and higher education cess paid through PLA under Notification No. 56/2002-CE dated 14.11.2002. (ii) Whether refund or self-credit could be restricted by Notification No. 19/2008-CE dated 27.03.2008 and Notification No. 34/2008-CE dated 10.06.2008.

Issue (i): Whether the assessee was entitled to refund or self-credit of education cess and higher education cess paid through PLA under Notification No. 56/2002-CE dated 14.11.2002.

Analysis: The Tribunal applied the settled position that education cess and higher education cess are in the nature of a continuation of duty. Once refund of duty paid through PLA is admissible, the corresponding refund or self-credit of education cess and higher education cess is also admissible.

Conclusion: The issue was decided in favour of the assessee, and refund or self-credit of education cess and higher education cess was held to be admissible.

Issue (ii): Whether refund or self-credit could be restricted by Notification No. 19/2008-CE dated 27.03.2008 and Notification No. 34/2008-CE dated 10.06.2008.

Analysis: The Tribunal relied on the decision of the High Court which had quashed the notifications imposing the restrictions. In consequence, the restriction sought to be applied through those notifications could not stand against the claim under Notification No. 56/2002-CE dated 14.11.2002.

Conclusion: The restriction under Notification No. 19/2008-CE dated 27.03.2008 and Notification No. 34/2008-CE dated 10.06.2008 was held inapplicable, and the assessee succeeded.

Final Conclusion: The refund or self-credit claim in respect of duty paid through PLA, including the corresponding cess component, was held allowable and the appeals were allowed.

Ratio Decidendi: Where cess is treated as a continuation of duty and the restrictive notifications have been quashed, refund or self-credit admissible on duty paid through PLA extends to the cess component as well.

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