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of <h1>100% EOU wins refund appeal as education cess on customs duties ruled not chargeable under Section 3(b)(ii) Rule 17</h1> CESTAT Chennai allowed appeal by 100% EOU against rejection of refund claim. Revenue invoked Section 3(b)(ii) with Rule 17 of Central Excise Rules, 2002, ... 100% EOU - rejection of refund claim - invocation of Section 3(b)(ii) ibid r/w Rule 17 of the Central Excise Rules, 2002, indicating that education cess and other cess would be chargeable again on the aggregate duties of customs, even though these were paid by the appellant under protest - HELD THAT:- The issue is no more res integra since the very same issue has been addressed to and answered in favour of the taxpayer by the Larger Bench of the Tribunal in the case of KUMAR ARCH TECH PVT LTD VERSUS COMMISSIONER OF CENTRAL EXCISE, JAIPUR-II [2013 (4) TMI 482 - CESTAT NEW DELHI - LB], which order has in fact been followed by this very Bench in the case of M/S. SKM EGG PRODUCTS EXPORT (INDIA) LTD. VERSUS COMMISSIONER OF GST & CENTRAL EXCISE, ANAIMEDU, SALEM [2024 (6) TMI 1173 - CESTAT CHENNAI]. In the said order, this Bench has referred to the findings at para 5 of the Larger Bench order and held that the impugned order is not in accordance with law. The impugned order cannot sustain for which reason the same is set aside - Appeal allowed. Issues:1. Whether the rejection of refund by the Revenue authorities is justifiedRs.Analysis:The case involves an appeal by an appellant, a 100% EOU engaged in the manufacture of electronic goods, regarding the rejection of their refund claim by the Revenue authorities. The appellant had effected certain DTA clearance and discharged the excise duty under Section 3(1) of the Central Excise Act, 1944. The Revenue invoked Section 3(b)(ii) ibid r/w Rule 17 of the Central Excise Rules, 2002, indicating that education cess and other cess would be chargeable again on the aggregate duties of customs, even though these were paid by the appellant under protest. The original authority and the First Appellate Authority rejected the refund claim, leading to the current appeal before the Tribunal.The primary issue before the Tribunal was to determine whether the rejection of the refund by the Revenue authorities was justified. The appellant's advocate argued that a similar issue had been addressed by the Larger Bench of the Tribunal in a previous case and had been decided in favor of the taxpayer. The Tribunal had held that charging education cess and S&H cess on DTA clearances made by 100% EOU, even if these cess were added while calculating the aggregate duties of customs, was not permissible. The Tribunal referred to the Finance Act provisions to explain that the intention of the legislature was never to charge education cess on education cess. The Tribunal concluded that the impugned order rejecting the refund could not be sustained and set it aside, allowing the appeal with consequential benefits as per law.In conclusion, the Tribunal decided in favor of the appellant, citing the precedent set by the Larger Bench of the Tribunal in a similar case. The Tribunal held that charging education cess and S&H cess on DTA clearances made by 100% EOU, when these cess were already included in the aggregate duties of customs, was not legally permissible. Therefore, the rejection of the refund claim by the Revenue authorities was deemed unjustified, and the appeal was allowed with consequential benefits.
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