TaxTMI 
TaxTMI 
2026 (3) TMI 508
X X X X Extracts X X X X
X X X X Extracts X X X X
....lated credit pertaining to Education Cess (EC), Secondary and Higher Education Cess (SHEC) and Krishi Kalyan Cess (KKC). 2. The issue for determination is whether under Section 140 & 142 of CGST Act, 2017, the appellant is entitled for refund of accumulated credit of Education Cess (EC), Secondary and Higher Education Cess (SHEC) and Krishi Kalyan Cess (KKC) paid on input services and lying un-utilised as on 30.6.2017? 3. The appellants were providing Banking and other Financial Services amongst other financial services. In the month of June, 2018, they filed two refund claims viz. Rs.15,78,680/- towards Education Cess and Secondary & Higher Education Cess; and Rs. 1,55,987/- in respect of Krishi Kalyan Cess lying in balance as on 30.....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he Special Leave Petition filed by Revenue challenging the said decision before the Hon'ble Supreme Court in UOI vs. Slovak India Trading Co.Ltd.; 2008 (223) ELT A170 (SC) was dismissed therefore the said decision of this Tribunal attained finality. 6. Per contra learned Authorised Representative appearing on behalf of revenue prayed for dismissal of appeals and in support placed on record a recent decision of the Larger Bench of the Tribunal in the matter of M/s. KEI Industries Ltd. vs. Commr. CGST & CE-Alwar in Appeal No. E/50090/2024 in which the Principal Bench of the Tribunal vide Interim Order No. 08/2025 dated 20.11.2025 has held that no refund can be granted for the blocked Education Cess, SHE Cess and KKC under the provisions of....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s to what credit was to be allowed under TRAN-1 and what was not to be allowed. As per para 4.1.1 of the said Circular, transition of Education Cess as well as Secondary and Higher Education Cess was not permitted. The relevant portion is extracted below : 4. Checks for Table 5(a): 4.1.1 Check 1: Verify that the credit has been taken against closing balance of CENVAT credit in ER-1/2/3 or ST-3. Credit can be taken only where the last return was filed and credit taken in Table 5(a) should not be more than closing balance of credit in ER-1/2/3 or ST-3 minus the education / secondary education cess / KKC/ SBC. 20. One more Circular No. 87/06/2019-GST Dated 2nd January, 2019 was issued. The relevant portion is given b....
X X X X Extracts X X X X
X X X X Extracts X X X X
....GST Act, it leaves no scope to view that the Ceses would be treated as being eligible as Input Tax Credit [ITC] under the GST regime. Therefore, we take the view that even on this ground, the Education Cess and SHE Cess and KKC could not have been transitioned. 24. Now we take up the next portion of the issue, ie., the refund claim filed towards the reversal made for the Education Cess, SHE cess and the KKC. xxx xxx xxx 27. A careful reading of Rule 3 (7) of the Cenvat Credit Rules 2004 with the provisos thereto, would clarify that the Education Cess and SHE Cess, while they were eligible to be taken as Cenvat Credit, they were specifically to be used for discharge of the Education Cess and SHE cess only for the finishe....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... of these judgements, we refuse to subscribe to the views of the appellants that had the "vested right" / "indefeasible right" even prior to 1.7.2017. xxx xxx xxx 40. Thus, we find that the Slovak India decision of the Karnataka High Court [affirmed by the Supreme Court] has been distinguished and overruled by the Three Judges Bench of the Bombay High Court. Therefore, the reliance placed on the Slovak India case by the appellants in the present case, seeking the refund of the Education Cess, SHE Cess and KKC, does not come to their rescue in any manner. xxx xxx xxx 45. We find that the above judgement of the Madras High Court to be the most comprehensive decision on the very issue of eligibility of refund of Educati....
X X X X Extracts X X X X
X X X X Extracts X X X X
....9;ble High Court in Slovak India Trading Co. Pvt. Ltd (supra), was dismissed in limine by the Hon'ble Supreme Court on the concession made by learned ASG appeared therein. Otherwise also the said decision has been doubted and was referred to Hon'ble Three Judges Bench of Bombay High Court in Gauri Plasticulture vs. CCE; 2019 (30) GSTL 224 (Bom.) wherein, after detailed analysis of the statutory provisions including Section 11B of Central Excise Act, 1944 and Rules 5 & 11 of Cenvat Credit Rules, while deciding the issue in favour of Revenue, it has been held that the Hon'ble Karnataka High Court in Slovak India (supra) has not discussed the scheme of Cenvat Credit in details and that the transitional provision does not entitle the cash r....