Indian Oil Corporation Limited Vs Commissioner of Customs (CESTAT Ahmedabad)
CESTAT Ahmedabad held that actual oil quantity physically received into the shore tank should be taken as the basis for payment of duty at the time of ex-bond bills of entry.
Facts- M/s. Indian Oil Corporation Limited, Kandla had imported 98 consignments of HSD and SKO during the period from May 1994 to December 1998 as a canalizing agency on behalf of himself as well as for M/s. Bharat Petroleum Corporation Limited, Kandla (BPCL) and M/s. Hindustan Petroleum Corporation Limited, Kandla (HPCL). The respective oil Companies filed Ex- bond Bills of Entry which were provisionally assessed. The quantity which was meant for IOCL was warehoused in the warehouse of the IOCL and quantity meant for BPCL and HPCL was warehoused in their respective warehouse / shore tanks for which each one of them were holding proper Customs Warehouse License.
The department has challenged the order-in-original, on the ground that Adjudicating Authority has erred in taking the transaction value as envisaged in CBEC Circular No. 6/2006 dated 12.02.2006 i.e. quantity of Crude oil taken on the basis of shore tank quantity was not correct and actual.
Conclusion- Hon’ble Apex Court in the case of Mangalore Refinery & Petrochem vs. CC, Mangalore has held that that the quantity of crude oil actually received into a shore tank in a port in India should be the basis for payment of customs duty.
Held that actual oil quantity physically received into the shore tank should be taken as the basis for payment of duty at the time of ex-bond bills of entry.
FULL TEXT OF THE CESTAT AHMEDABAD ORDER
The brief facts of the matter are that M/s. Indian Oil Corporation Limited (IOCL for short), Kandla had imported 98 consignments of HSD and SKO during the period from May 1994 to December 1998 as a canalizing agency on behalf of himself as well as for M/s. Bharat Petroleum Corporation Limited, Kandla (BPCL for short) and M/s. Hindustan Petroleum Corporation Limited, Kandla (HPCL for short). The respective oil Companies filed Ex-bond Bills of Entry which were provisionally assessed. The quantity which was meant for IOCL was warehoused in the warehouse of the IOCL and quantity meant for BPCL and HPCL was warehoused in their respective warehouse / shore tanks for which each one of them were holding proper Customs Warehouse License. M/s. IOCL, BPCL and HPCL paid duty provisionally at the time of clearance from the warehouse by filing ex-bond bills of entry proportionately depending upon the quantity of HSD, SKO cleared by them. On scrutiny of documents, following six show cause notices came to be issued:-
