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TMI Blog2021 (6) TMI 746X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 35F of the Finance Act, 1994. 2. Briefly the facts of the present case are that the appellant is a 100% EOU and engaged in the manufacture and exports of readymade garments falling under Chapter 61, 62 and 65 of Central Excise Tariff Act, 1985 (CETA) and is registered with Central Excise. During the course of audit of their records, it was observed from their ER-2 returns and sale invoices pertaining to DTA clearances made, there was short payment of Central Excise duty equivalent to Customs Education Cess and Customs Secondary higher-education cess. As per Section 3(1) of Central Excise Act, 1944 read with Notification No.23/2003 -CE dt. 31/03/2003, the total excise duty to be paid by100% EOU units on DTA clearances shall be equal to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Central Excise Law to the electronic Credit Ledger under the GST Law as per the transitional provisions of filing TRAN1 and there is no provision to debit their cenvat credit register for discharging their central excise liability after implementation of GST Law. Hence the debit of Rs. 3,76,308/- made by them appears to be invalid. Further, it appeared that they had neither debited the said duty of Rs. 3,76,308/- in their electronic ledger and not reflected the debits in the statutory GSTR3B returns filed nor paid the said duty of Rs. 3,76,308/- through cash/challans. As the debit of Rs. 3,76,308/- made by them in their cenvat credit register is invalid it appears that the central excise duty equivalent to Customs Education Cess and Custo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmitted that the appellant had paid the entire duty demanded by debiting their cenvat credit account but the same was not taken cognizance in the impugned order. He further submitted that once the entire amount has already been paid, the question of depositing further sum does not arise as per Section 35F of the Central Excise Act, 1944. 4.2. On merits, the learned counsel submitted that the appellant has correctly paid the duty of excise from the cenvat credit account. He further submitted that education cess and secondary education cess is not allowed to be carried forward as eligible duty of cenvat credit as per Section 140(1) read with Explanation 1 to Section 140(10) of CGST Act, 2017. He also submitted that once the credit of educati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al of the appeal for non-compliance of mandatory predeposit under Section 35F of the Finance Act, 1994 is not sustainable in law in the present case because the appellant has already paid the entire duty by debiting the cenvat credit account and also paid the interest in cash. Further I feel that the Commissioner(Appeals) after hearing the matter on merits should not have dismissed the appeal for non-compliance of Section 35F. Further I also find that as per Section 140(1) read with Explanation 1 to Section 140(10) of CGST Act, 2017, education cess and secondary education cess is not allowed to be carried forward as eligible duty of cenvat credit. This position has also been clarified by the CBIC vide circular No.87/06/2019GST dt. 02.01.201 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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