J&K and Ladakh HC allows refund of Education Cess amounting to dues under protest, subject to pendency of Supreme Court appeals and submission of bank guarantee.
J&K and Ladakh HC Allows Refund of Education Cess Under Safeguards
The Jammu and Kashmir and Ladakh High Court has permitted the refund of Education Cess amounts that were redeposited under protest by assessees. The ruling is conditional upon the pendency of related appeals before the Supreme Court and the furnishing of a bank guarantee for the disputed amount.
The Court held that where payment was initially made under protest and later challenged in higher forums, the revenue cannot indefinitely withhold refunds, particularly when larger legal questions remain undecided. The conditions ensure that the department's interest is protected during ongoing litigation.
Practitioner Takeaway: Assessees who have paid contested levies under protest may seek interim refunds during appellate pendency, provided adequate safeguards like bank guarantees are offered to the department.
