Exemption from Education Cess – Notification rescinded
Notification No. 18/2007-C.E., Dated 1.3.2007 exempts excisable goods from Education Cess in excess of 2%. But is not education cess 2%? Then what is the exemption. This is a long and circuitous story. The Secondary and Higher Education Cess was imposed by Clause 126 of the Finance Bill and as per the Provisional Collection of Taxes Act, it had immediate effect. Section 93 of the Finance Act, 2004 prescribes the rate of education cess as 2% on the aggregate of duties of excise but excluding education cess. This Section 93 was proposed to be amended by clause 131 of the Finance Bill, 2007 to exclude SHE also while computing the Cess. But this clause 131 being neither imposition nor increase in duties did not have immediate effect. It is to solve this problem that education cess in excess of 2% was exempted by Notification No. 18/2007. Now that the provisions of the Bill are enacted this notification is no more required and so rescinded.
Notification No. , Dated May 12, 2007