The Ahmedabad bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that refund is allowable on Pre-GST unutilized Credit of Education Cess, Secondary and Higher Education Cess (SHEC).
USV Private Limited, the appellant submitted that the Revenue has denied refund on two counts, first, the Cenvat credit of Education Cess and Secondary and Higher Education Cess is not admissible and second, the refund is time-barred.
In light of various High Court decisions according to which refund was allowed considering Rule 5 of Cenvat Credit Rules, 2004. It is not disputed that the appellant is not in a position to utilize Cenvat credit of Education Cess and Secondary and Higher Education Cess due to the introduction of GST with effect from 01.07.2017.
As regards the admissibility of Cenvat credit of Education Cess and Secondary and Higher Education Cess, Rule 3 provides the Cenvat credit to be allowed in respect of Education Cess and Secondary and Higher Education Cess.
Rule 3. CENVAT credit Provided that the CENVAT credit shall be allowed to be taken of the amount equal to central excise duty paid on the capital goods at the time of debonding of the unit in terms.
A Coram comprising of Mr Ramesh Nair, Member (Judicial) observed that from the above Rule, under clause (vi) and (via), the credit of Education Cess and Secondary and Higher Education Cess is allowed. Therefore, the appellant is legally entitled to Cenvat of Education Cess and Secondary and Higher Education Cess. Further held that the refund cannot be denied.
It was held by the High Court that in case of a refund of accumulated unutilized credit, the limitation shall not apply. The Tribunal held that “the appellant is entitled to a cash refund of accumulated and unutilized Cenvat credit of Education Cess and Secondary and Higher Education Cess. “
The impugned order is set aside and the appeal was allowed with consequential relief. Shri H.D. Dave, Advocate appeared for the Appellant and Shri Vijay G Iyengar appeared for the Revenue.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
