The Respondent is a manufacturer of pharmaceutical products. Respondent was located in the State of Sikkim. Vide Notification No. 20/2007-CE dated 25.04.2007, the Petitioner claimed refund of education cess or higher education cess paid by them. The said refund was sanctioned to the Petitioner as per decision of Supreme Court in the case of SRD Nutrients Private Limited. Thereafter, Supreme Court in Unicorn Industries took a dissenting view than the one in SRD Nutrients. Consequent to the same, show cause notice was issued for recovery of refund sanctioned to the Respondent. The adjudicating authority confirmed the demand. The said order was challenged before the CESTAT. The CESTAT set aside the demand order following decision of Tripura High Court in the case of Tripura Ispat. This order came to be challenged by Department before Sikkim High Court. The High Court, held that, when a refund was sanctioned pursuant to the judgment of the Supreme Court, cannot be said to be an erroneous refund. If the contention of the Department were to be accepted, it would result in chaos and no lis would assume finality. Followed Supreme Court in Saraswati Agro Chemicals Pvt. Ltd. and rejected the appeal.
Commissioner of CGST & C. Ex., v. Alkem Laboratories Limited – Tax Appeal No. 01 of 2024 [Sikkim HC]