(R. Subhash Reddy and Sanjiv Khanna, JJ.)
I.A. No. 51477 of 2020 In M.A. Nos. 2043-2052 of 2020 In Civil Appeal Nos. 2781-2790 of 2010
SRD Nutrients Private Limited _________________________ Appellant;
v.
Commissioner of Central Excise, Guwahati ____ Respondent/Applicant.
I.A. No. 51477 of 2020; M.A. Nos. 2043-2052 of 2020; and Civil Appeal Nos. 2781-2790 of 2010, decided on September 27, 2021
The Order of the court was delivered by
Order
1. This application is filed to modify the judgment dated 10.11.2017 rendered by this Court in Civil Appeal Nos. 2781-2790 of 2010.
2. Various notifications were issued by the Government of India for refund of excise duty paid on goods manufactured and cleared from units located in the specified States, in order to encourage business community to set up manufacturing units in industrially backward areas. The said notifications are area-based one. The said notifications allowed refund of excise duty leviable under the Act, equivalent to the amount of duty paid by the manufacturer other than the amount of duty paid by utilization of CENVAT credit. Such notifications were amended subsequently restricting the refund of duty only to the duty payable on value addition undertaken in the manufacture of the goods by such units. As per the notifications manufacturers were required to pay the duty initially at the time of clearance and thereafter claim the refund thereof.
3. The education cess, the secondary education cess and the higher education cess were imposed vide Finance Acts of 2004 and 2007, which were also collected from the manufacturers who had set up their units in the areas covered by notifications, along with the excise duty. However while refunding the excise duty, the cess amount collected was not refunded. The assessees challenged the orders denying the refund of education cess and higher education cess. The proceedings culminated in these appeals before this Court, which raised a dispute as to whether the education cess and higher education cess which were paid along with the excise duty was also liable to be refunded along with the central excise duty in terms of exemption notifications.
4. In the civil appeals after hearing was concluded written submissions were also filed on behalf of the applicant on 23.11.2017, with the permission of the Court. The applicant herein relied on the decision of this Court rendered in the case of Union of India v. Modi Rubber Ltd.1. It is the case of the applicant that though written submissions were filed by placing reliance on the earlier judgment of this Court in the case of Modi Rubber Ltd.1 written submissions and the judgment relied on were not considered while disposing of the appeals titled as SRD Nutrients Private Limited v. Commissioner of Central Excise, Guwahati2. By the aforesaid judgment this court has allowed the appeals holding that the appellants were entitled to refund of education cess and higher education cess which were paid along with the excise duty. Review Petition (C) Nos. 2477-2486 of 2018 (Diary No. 6714/2018) filed by the applicant herein also ended in dismissal. Subsequently in Civil Appeal No. 9237 of 2018, titled as Unicorn Industries v. Union of India3, with reference to very same issue this Court has held that the duty on NCCD, education cess, secondary and higher education cess are in the nature of additional excise duty as such same is not covered by the notification dated 09.09.2003, particularly when there is no reference to notification issued under the Finance Acts. In the case of Unicorn Industries3 this Court has relied upon the decision of a three-Judge Bench of this Court rendered in the case of Modi Rubber Ltd.1. Subsequently same was followed by another three-Judge Bench of this Court in the case of Rita Textiles Pvt. Ltd. v. Union of India4. In the judgment in the case of Unicorn Industries3 a three-Judge Bench of this Court has held that the judgment in the case of SRD Nutrients Private Limited2 and in the case of Bajaj Auto Ltd. v. Union of India5 were rendered by not considering the previous binding decision of a three-Judge Bench in the case of Modi Rubber Ltd.1 and Rita Textiles Pvt. Ltd.4, thus held they are clearly per incuriam. In the case of Unicorn Industries3 this Court has followed the earlier three-Judge Bench judgment in the case of Modi Rubber Ltd.1 and dismissed the appeals of the assessees.
5. In view of the judgment of this Court in the case of Unicorn Industries3 which is rendered by relying on the earlier judgments in the case of Modi Rubber Ltd.1 and in the case of Rita Textiles Pvt. Ltd.4, present application is filed seeking modification of the earlier judgment dated 10.11.2017 on the ground that if the said judgment is allowed to stand it will have widespread revenue ramifications. It is the case of the applicant that even in the present batch of appeals though they have raised a point that issue is covered by earlier three-Judge Bench judgment in the case of Modi Rubber Ltd.1 same was not considered either in the judgment or subsequent order dismissing the review petition.
6. We have heard Sri N. Venkataraman, learned Additional Solicitor General for the applicant, Sri V. Sridharan, learned senior counsel for the respondent and Sri Mukul Rohatgi and Sri Arvind Datar, learned senior counsels for the interveners. It is the case of the applicant that the judgment in the civil appeals is required to be modified as much as the earlier binding judgment of this Court rendered by a three-Judge Bench in the case of Modi Rubber Ltd.1 is not considered inspite of the fact that reliance is placed by specifically referring to the said judgment in the written submissions filed. It is stated that judgment in the batch of appeals was rendered without considering the earlier judgment in the case of Modi Rubber Ltd.1. It is also the case of the applicant that the very same issue is decided in favour of revenue in the case of Unicorn Industries3 by a three-Judge Bench of this Court. As such the judgment in the batch of civil appeals is to be modified. On the other hand it is the case of the respondent that the judgment in the batch of appeals was rendered by correctly interpreting the notifications and subsequent circulars issued and there is no infirmity or any irregularity to modify the same. It is also the case of the respondent and interveners that the present application for modification is not maintainable as much as their earlier application for review is already dismissed by this Court.
7. After hearing the learned counsels for the parties to some extent, we have noticed that the very issue, namely, the notifications notifying exemption from excise duty will cover the education cess, the secondary education cess and the higher education cess which were imposed vide Finance Acts is the core question to be considered. Whereas it is the case of the applicant that issue is covered in view of the earlier judgment of this Court in the case of Modi Rubber Ltd.1 which is rendered by three-Judge Bench of this Court, which is followed in the case of Unicorn Industries3 by this Court, on the very same issue in this batch of appeals this Court has held that when the duty is exempted the cess which is notified by subsequent Finance Acts which is leviable on excise duty also stands exempted. In view of the fact that the earlier judgment in the case of Unicorn Industries3 is rendered by three-Judge Bench of this Court, relying on earlier judgment of this Court in the case of Modi Rubber Ltd.1 which is also rendered by three-Judge Bench of this Court we are of the view that the present application is required to be considered by a three-Judge Bench. It is also to be noted that notice in the application is also issued by three-Judge Bench of this Court.
8. In view of the reasons stated above we are of the view that this application is required to be heard by a Bench of three Judges. Registry to place the papers before the Hon’ble Chief Justice and to list this application before three-Judge Bench, after obtaining appropriate directions from the Hon’ble Chief Justice.
Miscellaneous Application Nos. 2043-2052/2020 in C.A. Nos. 2781-2790/2010
M/s. SRD Nutrients Pvt. Ltd __________________________ Petitioner
v.
Commissioner of Cent. Excise ________________________ Respondent
(IA No. 51478/2020 – EXEMPTION FROM FILING AFFIDAVIT and IA No. 51477/2020 – MODIFICATION)
Date : 27-09-2021 These matters were called on for hearing today.
(Before R. Subhash Reddy and Sanjiv Khanna, JJ.)
For Applicant (s) Mr. N. Venkataraman, ASG
Mr. Arijit Prasad, Sr. Adv.
Mr. M.K. Maroria, AOR
Ms. Nisha Bagchi, Adv.
Ms. Shirin Khajuria, Adv.
Mr. Adit Khorana, Adv.
Mr. H.R. Rao, Adv.
Mr. B. Krishna Prasad, AOR
For Respondent(s) Mr. V. Sridharan, Sr. Adv.
Mr. Aditya Bhattacharya, Adv.
Mr. Amrinder Singh, Adv.
Ms. Mounica Kasturi, Adv.
Mr. Rahul Tangri, Adv.
Mr. Sahil Parghi, Adv.
Ms. Apeksha Mehta, Adv.
Ms. Charanya Lakshmikumaran, AOR
For Intervenors: Mr. Mukul Rohtagi, Sr. Adv.
Mr. Arvind Dattar, Sr. Adv.
Mr. Mahesh Agarwal, Adv.
Mr. Ankur Saigal, Adv.
Mr. Makarand Joshi, Adv.
Mr. Rishabh Parikh, Adv.
Ms. Sayaree Basu Malik, Adv.
Mr. E. C. Agrawala, AOR
UPON hearing the counsel the Court made the following
ORDER
9. This application is required to be heard by a Bench of three Judges. Registry to place the papers before the Hon’ble Chief Justice and to list this application before three-Judge Bench, after obtaining appropriate directions from the Hon’ble Chief Justice.
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1 (1986) 4 SCC 66
2 (2018) 1 SCC 105
3 (2020) 3 SCC 492
4 1986 Supp SCC 557
5 (2019) 19 SCC 801
