M/S. Pancharatna Cement PVT. LTD. vs. Union Of INDIA And 5 Ors

Held

The Court held that the respondents, specifically respondent Nos. 4, 5, and 6 (Commissioner of Central GST, Assistant Commissioner GST, and Superintendent GST), were directed to refund the education cess, including secondary and higher education cess, collected from the petitioner during the specified period. This decision was based on the petitioner's claim for exemption from central excise duty under the North-East Industrial Policy and a prior identical ruling by the same High Court. The revenue's submission that a policy decision had been taken to refund such cess further supported the petitioner's claim. The Court ordered the refund to be processed within three months of receiving a certified copy of the order. No specific provision was explicitly discussed in detail, but the underlying principle relates to the refund of taxes collected erroneously due to exemption provisions.

Facts

The petitioner, M/s. Pancharatna Cement Pvt. Ltd., an industrial unit in Assam, sought a direction from the Gauhati High Court to refund education cess and secondary and higher education cess collected from July 2004 to January 2015. The petitioner argued that under the North-East Industrial Policy, 2007, and notification No. 20/2017 dated 24.04.2007, it was entitled to 100% exemption from central excise duty. Since education cess is levied on excise duty, the petitioner contended it should not have been collected when excise duty itself was exempted. The petitioner relied on an identical case decided by the same High Court.

Key Issues

1. Whether the education cess and secondary and higher education cess collected from the petitioner for the period July 2004 to January 2015 are refundable, considering the petitioner's entitlement to exemption from central excise duty under the North-East Industrial Policy, 2007 and notification No. 20/2017 dated 24.04.2007? Petitioner's Argument: The petitioner contended that since the education cess and secondary and higher education cess are levied on excise duty, and the excise duty itself was exempted under the industrial policy, these cesses should not have been levied or collected. They relied on a previous identical judgment of the Gauhati High Court in WP(C) No. 5760 of 2018 (Kamakhya Plastics Pvt. Ltd –Vs- Union of India). Revenue's Argument: The learned Additional Solicitor General of India submitted that a decision had been taken by the competent authority in the Ministry of Finance, Government of India, to refund such cess irrespective of whether the assessee had approached the High Court.