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TMI Blog2017 (4) TMI 323X X X X Extracts X X X X X X X X Extracts X X X X ..... order holds that the sale price at which M/s. BPCL sold the product to other Oil Marketing Companies (OMCs) should be considered as normal transaction value and interest at appropriate rate would also be payable under Section 11AB of Central Excise Act, 1944. 3. The matter mainly pertains to the issue - "Whether duty of Central Excise is payable on the Refinery Gate Price (RGP) paid by the Oil Marketing Companies (OMC) to the appellant or it is payable on the subsidized price at which the Oil Marketing Companies so sell the goods (SKO - Superior Kerosene Oil) under PDS and LPG - Liquid Petroleum Gas (Domestic) to their consumers?" 4.1 The appellant also refers to another minor issue namely - "Whether terminal charges being the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... STC 487 (All.) * TISCO General Office Recreation Club v. State of Bihar - 2002 (126) STC 547 (SC) * Neyveli Liginite Corporation Ltd. v. CTO - 2001 (124) STC 586. 7. The learned AR on behalf of the respondent-Revenue inter alia pleads as follows : (i) The appellant, KRL paying duty at subsidized price whereas it is receiving the full price from Oil Marketing Companies (OMCs). (ii) The duty is payable on the full price collected from Oil Marketing Companies (OMCs). (iii) The subsidized value/price collected from the consumer by Oil Marketing Companies (OMCs) cannot be taken as assessable value for the purpose of payment of Central Excise duty. (iv) Under the concept of 'transaction value', the actual value ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on value for the purpose of assessment is no longer an issue when it is on record that the amount being paid by the Oil Marketing Companies (OMC) to the appellant - KRL already includes terminal charges in their payments made for the subject goods. Therefore, when we decide the main issue given above in Paragraphs 4 and 9, there is no need to give separate findings and decision on this minor issue. 10. The duty of Central Excise is charged on the transaction value as mentioned in Section 4(1) of the Central Excise Act, 1944. Section 4(1) is reproduced below for reference : "4. Valuation of excisable goods for purposes of charging of duty of excise. - (1) Where under this Act, the duty of excise is chargeable on any excisabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts of the assessable value/transaction value : (i) The sale of the goods by the assessee for delivery at the time and place of removal; (ii) The assessee and the buyer are not related; and (iii) Price is the sole consideration for sale. 10.1.2 In the present case, the transaction value would be the price, where above three elements/conditions are present or fulfilled. We find that above three elements are present in the case of the amount/the price paid by OMCs (other than the BPCL). The price which is charged by the appellant - KRL from the Oil Marketing Companies (other than the BPCL) is the price as per the provisions of Section 4(1) of the Central Excise Act, 1944. The price charged by the appellant - KRL from B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the purpose of payment of Central Excise duty. In the present case, subsidized price is not the sole consideration; therefore, it is not the 'transaction value' for the purpose of charging Central Excise duty. 10.3 The appellant submits that the Central Board of Excise & Customs (C.B.E. & C.) issued clarification Circulars saying that the subsidized price is to be taken as assessable value. However, when the provisions relating to valuation given in the Section 4(1) of the Central Excise Act, 1944 are very clear, this submission of the appellants and the said C.B.E. & C. Circulars do not have sufficient legal force and cannot be given any legal effect. 10.4 For our conclusions made above, we take support from the Hon'ble Supreme ..... X X X X Extracts X X X X X X X X Extracts X X X X
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