ISPAT INDUSTRIES LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) This judgment would govern two petitions, one instituted by Ispat Industries Limited (Ispat) and the second, by the Union of India, through the Commissioner of Central Excise, Raigad. Both the petitions have been heard together.

(2.) The facts in so far as they are relevant to the controversy in this case are thus : Ispat claims to have exported HR coils of steel on the payment of applicable excise duty including education cess between 9 July 2004 and 6 September 2004. On 8 September 2004, Ispat lodged a rebate claim for exports made between 10 August 2004 and 24 August 2004 in the amount of Rs. 2.81 crores including excise duty and education cess. On 30 November 2004, the Deputy Commissioner of Central Excise allowed the claim, to the extent of rebate of basic excise duty in the amount of Rs. 1.82 crores but declined to grant a rebate on the education cess paid in the amount of Rs. 5.52 lakhs. The Assessing Authority held that the duty paid by way of education cess was admissible for a rebate only with effect from 6 September 2004 under Notification No. 19/2004NT and since the goods were exported by Ispat prior to that date, rebate on education cess cannot be allowed. Apart from the claim for rebate filed on 8 September 2004, Ispat had filed four other claims between 8 September 2004 and 11 October 2004. The remaining four claims were similarly allowed by the Assessing Authority to the extent of a rebate of basic excise duty but the claim for rebate in respect of education cess was disallowed. In pursuance of the orders passed by the Assessing Authority, Ispat collected cheques representing the rebate granted on the basic excise duty.

(3.) The order passed by the Deputy Commissioner of Central Excise on 30 November 2004 attained finality and no appeal was filed by Ispat against that order. Similarly, no appeals were filed in respect of the other four claims. On 20 December 2005, an application was filed by Ispat before the Deputy Commissioner, Central Excise seeking refund of education cess in respect of the very same transactions. In the application, there was an averment to the effect that the rebate claims were sanctioned for an amount of basic excise duty only and that the amount of education cess involved was retained by the Assessing Authority for the reason that education cess is not a part of excise duty. Relying on an order passed by the Commissioner (Appeals) in the case of some other assessee, Ispat moved the aforesaid application on 20 December 2005. The application was rejected by the Assistant Commissioner on 28 December 2006 and the rejection was affirmed by the Commissioner (Appeals) on 24 July 2007. Ispat thereupon moved a revision before the Government of India which was allowed by the revisional authority on 11 September 2009.