Education Cess - Stainless Steel Patta Patti or Aluminium Circles under the Compounded Levy Scheme – CBEC clarifies
Chief Commissioner of Central Excise, Jaipur has pointed out that certain units manufacturing stainless steel patta and aluminium circles and working under the compounded levy scheme have objected to the levy of education and higher education cess under the said scheme, citing the Board instructions issued vide F.No. dated 19th December, 2007.
Board clarifies that the above instructions were issued for compounded levy scheme for Pan Masala or Pan Masala containing tobacco. While determining the total amount of compounded levy in this case, quantum of education and higher education cess was taken into account. Accordingly it has been clarified that no education or higher education cess will be leviable over and above the amount paid under the compounding scheme.
Compounded levy scheme for stainless steel patta patti and aluminium circle under Rule 15 of the Central Excise Rules, 2001 was notified vide notification No. 34/2001-CE, dated 28th June, 2001. Education Cess has been levied vide Finance Act, 2004 and Higher Education Cess vide Finance Act, 2007. Since these levies were not there at the time of introduction of compounded levy scheme for stainless steel patta patti and aluminium circles the same was not a part of the amount of payable under this scheme. TRU has clarified that increase in amount payable under the compounded levy scheme subsequently is on account of increase in price of stainless steel and aluminium and not because of inclusion of any other levy within the scheme.
Therefore, Board clarifies that the rate of duty under the optional compounded levy scheme for stainless steel patta patti and aluminium circles vide notification No. 17/2007-CE, dated 1st March 2007 covers only basic excise duty and does not include the education cess and higher education cess, which are payable over and above the rate of basis excise duty notified by the said notification.
F.No. Dated: August 28, 2008