2022 (5) TMI 1361 - HC - Central Excise

Appeals Dismissed: Filing Delays, Monetary Limit, No Substantial Law Question; Change in Opinion Doesn't Reopen Cases.

Commissioner of CGST and Commissioner of Central Excise, (J&K) Jammu Versus M/s Narbada Industries

Commissioner of CGST and Commissioner of Central Excise, (J&K) Jammu Versus M/s Narbada Industries - 2023 (385) E.L.T. 364 (J & K and Ladakh) Issues Involved:1. Limitation and delay in filing appeals.2. Monetary limit for filing appeals.3. Jurisdiction of the High Court vs. Supreme Court.4. Substantial question of law.5. Merits of the case and refund of Education Cess and Secondary & Higher Education Cess.Detailed Analysis:1. Limitation and Delay in Filing Appeals:The judgment notes that nearly all appeals were filed beyond the prescribed 180-day period under Section 35G of the Central Excise Act, 1944. The appellants argued that the delay should be condoned due to the Supreme Court's decision in Unicorn Industries (2020), which overruled the earlier SRD Nutrients (2017) decision. However, the court emphasized that the limitation period starts from the date of service of the order, not from the date of a subsequent judicial decision. The court cited several precedents, including Collector Land Acquisition Anantnag vs. Mst. Katiji and Ajit Singh Thakur Singh vs. State of Gujarat, to stress that the delay must be justified by events occurring within the limitation period. The court found no sufficient cause for the delay and rejected the applications for condonation of delay.2. Monetary Limit for Filing Appeals:The court addressed whether the appeals were maintainable given the monetary limit prescribed by the Ministry of Finance's Circular dated 22.08.2019, which restricts filing appeals in the High Court if the tax incidence is below Rs. 1 Crore. The court examined the individual tax incidences in each appeal and found that none met the Rs. 1 Crore threshold. The court rejected the appellant's argument that the collective tax incidence should be considered. The court held that the circulars are binding on the department and cited Collector of Central Excise Vadodra vs. Dhiren Chemical Industries to support this view. Consequently, the appeals were deemed not maintainable based on the monetary limit.3. Jurisdiction of the High Court vs. Supreme Court:The court examined whether the appeals should have been filed directly in the Supreme Court under Section 35L of the Act, as they pertain to the rate of excise duty. The court concluded that the issue at hand did not relate to the determination of the rate of duty or the value of goods for assessment purposes but rather to the refund of Education Cess and Secondary & Higher Education Cess. Therefore, the appeals were rightly filed in the High Court and were maintainable in this regard.4. Substantial Question of Law:The court found that the proposed question of law—whether the assessee is liable to return the Education Cess and Secondary & Higher Education Cess based on the Supreme Court's decision in Unicorn Industries—was not a substantial question of law. The issue had already been settled by various judicial decisions, and thus, the appeals did not involve any substantial question of law.5. Merits of the Case and Refund of Education Cess and Secondary & Higher Education Cess:On the merits, the court held that the subsequent change in judicial opinion (Unicorn Industries overruling SRD Nutrients) does not entitle the appellants to reopen past cases that were decided based on the prevailing law at the time. The court cited Mafatlal Industries Limited vs. Union of India and Tilokchand MotiChand vs. H. B. Munshi to emphasize that final decisions should not be reopened based on subsequent judicial changes. The court also referred to State of Gujarat vs. ESSAR Oil Limited, holding that no refund should be ordered if the benefit was lawfully acquired under the prevailing law.Conclusion:The court dismissed the appeals primarily due to the delay in filing, non-maintainability based on the monetary limit, and lack of a substantial question of law. The court also ruled that the change in judicial opinion does not warrant reopening cases that have attained finality. The appeals were dismissed with no order as to costs.