Page 174 - ELT_1st August 2020_Vol 373_Part 3

356 EXCISE LAW TIMES [ Vol. 373

they were in the nature of levy on the excise duty payable, the NCCD is levied on
the product itself, as per Section 136 of the Finance Act, 2001. The Court held that
NCCD, Education Cess and Secondary & Higher Education Cess are in the na-
ture of surcharges levied in other Acts. The Court placed reliance upon its earlier
decision in the case of SRD Nutrients Pvt. Ltd. v. Commissioner of Central Excise,
Guwahati, (2018) 1 SCC 105 [2017 (355) E.L.T. 481 (S.C.)], and concurred with the
view expressed by the Rajasthan High Court in Banswara Syntex Ltd. v. Union of
India, 2007 (216) E.L.T. 16, and held thus :
“20. We may notice that the primary reasoning contained in the im-
pugned order is common for the three cesses, i.e., NCCD; Education Cess
and Secondary & Higher Education Cess. These were in the nature of sur-
charges levied in other Acts, which have not been specifically excluded un-
der the Notification in question. That reasoning does not prevail, more so
because of the judgment in SRD Nutrients Pvt. Ltd. (supra) The question,
thus, is whether, even though the NCCD is in the nature of an excise duty,
its incidence being on the product, rather than on the value of the excise du-
ty, that itself would make any difference to the applicability of the NCCD to
excise exempt units.
21. On a proper appreciation of the judicial pronouncement in SRD Nutri-
ents Pvt. Ltd., (supra) we are not inclined to take a different view from the
one taken for Education Cess and Secondary & Higher Education Cess,
even while considering the issue of NCCD.
22. We may notice that this Court, in SRD Nutrients Pvt. Ltd. (supra) gave
its imprimatur to the view expressed by the Rajasthan High Court in
Banswara Syntex Ltd. (supra). The rationale is that while there may be sur-
charges under different financial enactments to provide the Government
with revenue for specified purposes, the same have been notified as levia-
ble in the nature of a particular kind of duty. In the case of NCCD, it is in
the nature of an excise duty. It has to bear the same character as those re-
spective taxes to which the surcharge is appended. NCCD will not cease to
be an excise duty, but is the same as an excise duty, even if it is levied on
the product. Thus, when NCCD, at the time of collection, takes the charac-
ter of a duty on the product, whatever may be the rationale behind it, it is
also subject to the provisions relating to excise duty, applicable to it in the
manner of collection as well as the obligation of the taxpayer to discharge
the duty. Once the excise duty is exempted, NCCD, levied as an excise duty
cannot partake a different character and, thus, would be entitled to the ben-
efit of the exemption notification. The exemption notification also states
that the exemption is from the “whole of the duty of excise or additional
duty of excise.” We may also note that the exemption itself is for a period of
ten years from the date of commercial production of the unit.
23. We are, thus, of the view that the appellant would not be liable to pay
the NCCD.
It was submitted that the above decision would be squarely applicable to
the facts of the present case.
5.2 The attention of the Court was further invited to Circular No.
4/2019-Cus. (Instruction), dated 11-10-2019, issued by the Central Board of Indi-
rect Taxes & Customs, New Delhi, (hereinafter referred to as the “CBEC”) where-
in, it has been clarified that as regards Secondary and Higher Education Cess
(SHE) and Social Welfare Surcharge (SWS), the SHE cess is levied under Section
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