Case Law Details
South Eastern Coalfields Limited Vs Commissioner (Audit) (CESTAT Delhi)
Introduction: In a significant case heard by the Hon’ble CESTAT, Delhi, the question of imposing Clean Energy/Environment Cess (CEC) on the closing stock of coal as of June 30, 2017, took center stage. The dispute revolved around the interpretation of the Taxation Amendment Act, 2017, and its applicability post-GST.
Detailed Analysis: The crux of the matter was whether the liability for CEC was incurred on the closing stock of coal despite the repeal of CEC provisions from July 1, 2017.
The Department argued that though the provisions relating to levy of CEC were repealed w.e.f. 01.07.2017, the liability of CEC had been incurred and accrued on production of coal and was therefore saved by Section 18(2) of the Taxation Amendment Act, 2017, particularly in view of the decision of the Hon’ble Supreme Court in Collector of C. Ex, Hyderabad v Vazir Sultan Tobacco Co Ltd, 1996 (83) ELT 3 (SC).
The Assessee Appellant contended that the liability of CEC did not crystallize till the date of repeal of the CEC and, therefore, the question of it being saved by the savings clause is misconceived. Reliance was placed on a catena of judgments to emphasize that Removal of Excisable Goods is the essence of crystallization of the duty charge which was evident from Rule 4 of the CEC Rules. It was submitted that the judgment of Apex Court in Vazir Sultan Tobacco Co was not applicable to the facts of the case.
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