Refund of education cess and higher education cess follows exemption of excise duty under settled Supreme Court principle.

Education cess and higher education cess levied at 2% of excise duty were treated as part of excise duty itself and, once the underlying excise duty was exempted, became refundable. The Gauhati HC proceeded on the settled Supreme Court position and the respondents' acceptance that the same principle applied to the petitioner's claim for the period May 2008 to February 2015. Linked to the exemption under Notification No. 20/2007-CE, the Court directed refund of the cess amounts within the stipulated time.

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Issues: Whether the petitioner was entitled to refund of education cess and higher education cess paid during the period May 2008 to February 2015 on the footing that such cess formed part of excise duty and became refundable once the underlying excise duty was exempted.

Analysis: The governing legal position had already been settled by the Supreme Court, which held that education cess and higher education cess levied at 2% of excise duty partake the character of excise duty itself and are refundable when excise duty is exempted. The respondents accepted that the same principle governed the present claim, and the Court proceeded on the basis of that consensus. The petitioner's claim was also linked to the exemption available under Notification No. 20/2007-CE dated 25.04.2007.

Conclusion: The petitioner was entitled to refund of the education cess and higher education cess paid for the relevant period, and the respondents were directed to calculate and refund the amount within the stipulated time.

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