JUDGMENT :

Deepak Roshan, J.

Heard learned counsel for the parties.

2. The petitioner has prayed for the following reliefs:

(i) For issuance of appropriate writ(s)/order(s)/, direction(s) quashing the order dated 29/09/2020 (Annexure-3) passed by Principal Commissioner, Goods & Services Tax-CX whereby and whereunder the contentions of the petitioner were rejected and a demand against Clean Environment Cess of Rs. 470,83,42,400 was confirmed by Respondent No.3 and to be recovered from the petitioner along with an equivalent penalty imposed under Section 11AC of the Central Excise Act, 1944 read with Clean Energy Cess Rules, 2010 on the alleged closing stock of coal on June 30, 2017 and all the purported proceedings there under and/or relating thereto and/or in pursuance thereof and to act according to law;

And;

(ii) For issuance of appropriate writ(s)/order(s), direction(s) for any Injunction restraining the respondents and each of their servants and/or agents and/or assignees to forebear from giving any effect and/or further effect to and/or acting on the basis of and/or in furtherance of the purported order dated 29/09/2020 and/or any purported proceedings there under and/or relating thereto and/or in pursuance thereof;

And;

(iii) During the pendency of this present writ application, it is humbly prayed that the operation of the order dated 29/09/2020 may be stayed.

3. The brief facts of the case as it appears from the writ application is that the petitioner is a subsidiary of Coal India Limited and is a Category-I Mini Ratna Company since 2007. In the instant writ petition the petitioner has challenged the order dated 29.09.2020 passed by respondent no. 3(Annexure-3). By the said order, respondent no. 3 has confirmed the demand of Clean Energy Cess amounting to Rs. 470,83,42,400/-under Section 11 (A) of the Central Excise Act, 1944 read with Rule 6(5) of the Clean Environment Cess Rules, 2010 (herein after to be referred as Cess Rules) along with interest under Section 11AA/11AB of the Central Excise Act, 1944 and penalty under Section 11AC of the Central Excise Act, 1944.

The case of the petitioner is that with the introduction of GST, the levy of clean energy cess was replaced by the GST Compensation Cess under the Goods & Services (Compensation to States) Act, 2017. Accordingly, petitioner has undisputedly paid the GST Compensation Cess on all clearances made post 01.07.2017.

4. Learned counsel for the petitioner has assailed the impugned order dated 29.09.2020 on following grounds: -

(I) Cess is payable on removal. Since, on the date of removal, the rate of Clean Energy was not prescribed, there was no requirement to pay the Cess.

(II) The Clean Energy Cess Rules stands repealed and in absence of any saving provision, the levy of Clean Energy Cess is invalid.

(III) In the absence of any power given to borrow the recovery provision, Cess cannot be recovered.

(IV) Petitioner is paying Compensation Cess on the coal supplied post 01.07.2017. The levy of cess twice over on the same transaction is ex facie unsustainable and manifestly arbitrary.

(V) The findings of suppression and intent to invade tax is without any basis.

5. In support of ground No. I, learned counsel submitted that as per Rule 4 of the Cess Rules, the Cess is payable on the removal of specified goods in the manner specified in Rule 6. It has been further submitted that Rule 5 of the Central Excise Rules, 2012 provides that the rate of duty applicable to any excisable goods shall be the rate in force on the date such goods are removed from the factory.

In terms of the above Rules, in the event of increase in the rate of Clean Energy Cess, the petitioner was paying the Cess at the increased rate for the coal lying in stock as on the date of rate change. This is explained in the table below: