VIPOR CHEMICALS PVT LTD Vs. UNION OF IDNIA

JUDGEMENT

(1.) RULE. learned Assistant Solicitor General waives service of rule. In the facts and circumstances of the case, the petition is taken up for final disposal.

(2.) IN this petition under Article 226 of the Constitution, the petitioner has challenged denial of refund of education cess under the provisions of the Notification under clause 40 of 2001-CE dated 26. 06. 2001 issued under Rule 18 of the Central Excise Rules, 2002, even though refund of CENVAT credit on the export consignments has already been granted to the petitioner. It is submitted that education cess is levied in the nature of surcharge on excise duty. Therefore, when the petitioner is compelled to pay excise duty with education cess and ultimately, it is held that the petitioner is entitled to refund of excise duty as a necessary and logical corollary, the petitioner must also be held to be entitled to refund of education cess. Our attention is invited to the decision of a Division Bench of the Rajasthan High Court in Banswara Syntex Ltd. Vs. Union of India, 2007 (216) E. L. T. 16 (Raj.)

(3.) THERE is no dispute about the fact that by Notification No. 19 of 2004 dated 06. 09. 2004, rebate on education cess is allowed in terms of Rule 18 of Central Excise Rules, 2002; by providing that the expression, 'duty' also includes education cess on excisable goods as levied under clause 81 read with clause 83 of the Finance Bill 2/ 2004. The dispute, therefore, is only for the period prior to 06. 09. 2004. After considering all the relevant statutory provisions and the notifications, a Division Bench of the Rajasthan High Court has held that even for the period prior to 06. 09. 2004, the definition of 'duty' would include education cess on excisable goods and that therefore, an assessee, who is entitled to refund of excise duty would also be entitled to refund of education cess paid in the nature of surcharge on excise duty.