TMI Blog2018 (2) TMI 476X X X X Extracts X X X X X X X X Extracts X X X X ..... te duty of customs levied under Sec.12 the Customs Act, 1962 can never be held to be admissible to credit which continued to be levied before and after 17.3.2012. Penalty - Held that: - issue involved in the present appeals relates to pure question of interpretation of law and the demand notices were issued for normal period of limitation, therefore, imposition of penalty on the assesses is unwarranted - penalty set aside. Appeal allowed in part. - E/13167/2013-SMC, E/13885/2013-SMC, E/12061/2015-SMC E/10099/2016-SMC, E/10100/2016-SMC, E/10101/2016-SMC, E/10409/2016-SMC, E/12060/2015-SMC, E/11146/2016-SMC, E/CO/10118/2017, E/12126/2016-SMC - Final Order No.A/10237-10246/2018 - Dated:- 31-1-2018 - Dr. D.M. Misra, Member ( Judicial ) S/Shri P.M. Dave, Aditya Tripathi, Advocates with Shri V. Jhala, Authorised Representative for the Appellants Shri K.J. Kinariwala, A.R. for the Respondent-Revenue ORDER Per Dr. D.M. Misra The aforesaid Appeals are filed against respective Orders-in-Appeal passed by Commissioner (Appeals) Central Excise, Customs Service Tax. Out of the above ten appeals, nine appeals are filed by the respective assesses and one by the Rev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said Notifications were issued to bring the method of computation of cesses in line with the principle of law laid down by the Hon ble Tribunal. 4. He has argued that if by the first Notification No.13/2012-cus Education cess leviable under Sections 91,93 and 94 of Finance Act,2004 became exempted and by Notification No.14/2014-cus secondary higher education cess leviable under Sections 136,138 and 139 of the Finance Act,2007 became exempted, then under what provision the Cesses are levied and collected. It is his submission that answer to the said question is the key to the dispute in the present case. He has submitted that by virtue of Section 3(1) of the CTA, 1975, additional duty of customs is levied on goods imported into India, and it is equal to excise duty, chargeable on like articles produced or manufactured in India. The provision further lays down that if the excise duty leviable on the like goods was on ad valorem basis, then the additional duty on the imported goods would also be on ad valorem basis. 5. In the present case, all goods imported by the appellants, applicable additional duty of customs (CVD) equal to basic excise duty has been levied, assessed and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... condary Higher Education Cess. It is his contention that for all legal and practical purposes amount assessed and collected as Education Cess and Secondary Higher Education Cess are education cesses and not Central Excise cess or customs cess. 7. He has further contended that in view of the exemption from payment of Education Cess and Secondary Higher Education Cess leviable under Section 91,93 and 94 of the Finance Act, 2004 and Sections 136, 138 and 139 of the Finance Act, 2007, Education Cess and Secondary Higher Education Cess charged and collected from the appellant are in the nature of additional duty leviable under Section 3 of the Customs Tariff Act, equivalent to Education Cess as well as Secondary Higher Education Cess levialble on similar goods manufactured in India. Such education cess and secondary higher education cess on excisable goods are specified under clauses (vi) and (via) of Rule 3(1) of the CCR, 2004. Additional duty leviable under Section 3 of the CTA, 1975 equivalent to duty of excise specified under clause (vi) and (via) are admissible as cenvat credit by virtue of clause (vii) of Rule 3(1) of CCR, 2004. In the present case, there being exemption from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sses were levied twice, first under Section 3(1) of the CTA and again under Section 91 read with Section 94 as well as Section 136 read with Section 139 of the Finance Act, 2007. The first time CESS is collected in terms of section 3(1) of Customs Tariff Act, 1975 and second time on aggregate of duties of Customs (which included cesses on BED) in terms of Section 91 read with Section 94 relating to education cess of Finance Act, 2004 and Section 136 read with Section 139 of Finance Act, 2007 relating to Secondary Higher Education Cess. It is his contention that in terms of Rule 3 of CCR, 2004 cess paid on basic excise duty (Component of CVD) levied in terms of Section 3(1) of Customs Tariff Act was allowed as credit, whereas cenvat credit of cesses paid on aggregate duties of customs in terms of Section 91 read with Section 94 of Finance Act, 2004 and Section 136 read with Section 139 of Finance Act 2007 was never admissible. Further, he has submitted that to simplify the issue of eligibility of cenvat credit of Education Cess and Secondary Higher Education Cess paid on imported goods, the exemption Notification No. 13 14 dated 17.03.2012 were issued. Thus, cess on imported goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vi) the Education Cess on excisable goods leviable under section 91 read with section 93 of the Finance (No. 2) Act, 2004 (23 of 2004); (via) the Secondary and Higher Education Cess on excisable goods leviable under section 136 read with section 138 of the Finance Act, 2007 (22 of 2007); (vii) the additional duty leviable under section 3 of the Customs Tariff Act, equivalent to the duty of excise specified under clauses (i), (ii), (iii), (iv), (v) [, (vi) and (via)]: [ *** ] [(viia) the additional duty leviable under sub-section (5) of section 3 of the Customs Tariff Act [ * * * ] : Provided that a provider of [output] service shall not be eligible to take credit of such additional duty;] (viii) the additional duty of excise leviable under section 157 of the Finance Act, 2003 (32 of 2003); (ix) the service tax leviable under section 66 of the Finance Act; [* * *] [(ixa) the service tax leviable under section 66A of the Finance Act;] [(ixb) the service tax leviable under section 66B of the Finance Act;] (x) the Education Cess on taxable services leviable under section 91 read with section 95 of the Finance (No. 2) Act, 2004 (23 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 136 read with Section 138 of Finance Act, 2007, are eligible to credit. Under Clause (vii) additional duty of customs leviable under Section 3 of the Customs Tariff Act equivalent to duty of excise specified under Clause (i),(ii),(iii),(iv),(v),(vi), (via) is eligible to credit. 12. The Revenue as well as the assesse have fairly argued that prior to 17.03.2012 Education Cess and Secondary Higher Education Cess was collected twice on the imported goods, first on the CVD portion of the duty and secondly on aggregate duties of customs which comprised CVD portion of duty and also Education Cess and Secondary Higher Education Cess on CVD. Needless to mention Additional duty under Sec.3(1) of the CTA,1975 is a customs duty levied on imported goods, and its rate is equivalent to the like article manufactured and produced in India, popularly called as Countervailing duty(CVD). On issuance of Notification No. 13/12-Cus and 14/12-Cus both dated 17.03.2012, exemption was allowed to Education Cess and Secondary Higher Education Cess charged on the additional duty of customs i.e. CVD portion of duty, whereas levy of Education Cess and Secondary Higher Education Cess continue to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 91 read with Sec. 94 of the Finance Act,2004 and Secondary Higher Education Cess levied under Sec.136 read with Sec 139 of Fiance Act,2004 which was not allowed as credit even though paid prior to 17.3.2012. With the amending Notifications 13/2012 Cus. and 14/2012 Cus. Dt.17.3.2012 education cess and Secondary Higher Education Cess leviable under Sec.3(1) of the CTA,1975 read with provisions governing the said Cesses i.e. secs.91,93 94 of Finance Act,2004 and Sec.136,138 139 of Finance Act,2007 have been exempted on imported goods. The said Notifications were issued under Sec.25 of the Customs Act,1962 as the said cess were allowed exemption on the additional duty of customs levied under Sec 3(1) of Customs Tariff Act,1975. Thus, the equivalent duty under clause(vi) (via) as mentioned under cl.(vii) of CCR,2004, after 17.3.2012 being exempted, no credit could be extended on the same. Therefore, the Education Cess and Secondary Higher Education Cess paid under Section 94 of the Finance Act 2004 and Section 139 of the Finance Act, 2007, on the aggregate duty of customs levied under Sec.12 the Customs Act,1962 can never be held to be admissible to credit which continued to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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