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2024 (3) TMI 496 - CESTAT KOLKATALevy of service tax - Transportation of Gas through Pipeline and Conduit Service - Business Auxiliary Service - receiving consideration in the form of Minimum Demand Charges (MDC) for gas transportation from their customers. Demand on extra consideration in the form of MDC for gas transportation - total consumption of gas is falls 90% of the yearly booked quantity of gas by the customers - HELD THAT:- Aas the customer has failed to derive more than 90% through Pipeline, in that circumstances, the customer has to pay the penalty to the appellant. The amount received by the appellant by way of penalty, cannot be termed as the appellant has provided any service - the MDC received by the appellant, the appellant is not liable to pay service. Therefore, the demand confirmed in the impugned order quo minimum demand charges are set aside. Demand on realization of the sale value of gas on behalf of M/s Oil India Limited, Duliajan from the purchasers and from the consumers of gas along with royalty and marketing margin - HELD THAT:- It is reported that the marketing margins were collected from the customers for supply of gas on behalf of M/s Oil India Limited, Duliajan, which are also a sale value of the gas on which VAT has been paid and the said issue has been dealt with by this Tribunal in the case of GAIL INDIA LTD VERSUS CCE, DELHI [2017 (9) TMI 554 - CESTAT NEW DELHI], wherein this Tribunal has held The jurisdictional authorities after examining the sale agreement, categorically held that the charges received by the appellant are part of sale of gas and cannot be subject to Service Tax. It was held that the value in dispute is included in the assessable value being part of the sale of gas and applicable VAT has been paid. Accordingly, the original authority dropped the demand for Service Tax. As the issue has been settled by this Tribunal in the case of GAIL India Limited, it is held that as on this marketing margin received by the appellant have already paid the VAT by M/s Oil India Limited, the appellant is not liable to pay the service tax thereon. In that circumstances, on marketing margin, the appellant is not liable to pay service tax. The impugned demands are not sustainable against the appellants and therefore, the same are set aside - Appeal allowed.
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