M/S. Godrej Consumer Products LTD. vs. Union Of INDIA And 5 Ors.

Held

The Court held that the education cess and higher education cess paid by the petitioner are refundable. This decision was based on the Supreme Court's judgment in M/s SRD Nutrients Private Limited, which established that these cesses partake of the character of excise duty itself. Consequently, when excise duty is exempted under the North East Industrial and Investment Promotion Policy, 2007, the education cess and higher education cess paid along with it are also eligible for refund. The Court noted the consensus between the parties on this issue. The respondents, specifically authorities Nos. 4 to 6, were directed to calculate and refund the education cess and higher education cess paid by the petitioner from July 2004 to December 2015 within five months of receiving a certified copy of the order. No issue was expressly left undecided.

Facts

M/s. Godrej Consumer Products Ltd., an industrial unit in Assam, sought a refund of education cess and higher education cess paid between July 2004 and December 2015. The petitioner was entitled to excise duty exemptions under the North East Industrial and Investment Promotion Policy (NEIIPP), 2007. While excise duty was refunded, a question arose whether the education cess and higher education cess, levied under the Finance Act of 2004, were also refundable as part of the excise duty exemption. The petitioner relied on a Supreme Court judgment in M/s SRD Nutrients Private Limited, which held that education cess and higher education cess partake of the character of excise duty itself and are thus refundable when excise duty is exempted.

Key Issues

1. Whether education cess and higher education cess levied under the Finance Act of 2004 are part of excise duty for the purpose of refund under the North East Industrial and Investment Promotion Policy, 2007? Petitioner's argument: The petitioner contended that the Hon'ble Supreme Court in M/s SRD Nutrients Private Limited –vs- Commissioner of Central Excise, Guwahati, has held that education cess and higher education cess are part of excise duty. Therefore, they are entitled to a refund of these cesses for the period from July 2004 to December 2015, as the excise duty itself was exempted under NEIIPP, 2007. They also referred to a Meghalaya High Court order in a similar case. Revenue's argument: The respondents, through the learned ASGI, submitted that following the Supreme Court's pronouncement in M/s SRD Nutrients Private Limited, the authorities are bound to refund the education cess and higher education cess paid by the petitioner for the specified period.