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TMI Blog2023 (11) TMI 1165X X X X Extracts X X X X X X X X Extracts X X X X ..... (iii) Kakinada Seaports Pvt Ltd (KSPL) and (iv) the Government of Andhra Pradesh. The Appellant manufactures Compressed Natural Gas (CNG). The Appellant was registered with the department and have discharged Central Excise duty for the period August 2005 to December 2009. 3. Owing to its sensitive nature, CNG and its transactions are regulated and administered in a precise manner. The CNG manufactured by the Appellant is dispatched from its factory, in some cases via 'under-ground pipelines' and in some cases via 'automobile trucks'. In the instant case, the Appellant has cleared CNG from its factory located at RS No.70, Gollapudi Road, Vidyadharapuram, Near YV Rao Estates, Vijayawada, and has dispatched to its customer i.e., HPCL via 'au ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s made by HPCL is retained by HPCL alone and it is never passed on to Appellant. There is no allegation or finding in the assessment order or in the Appellate Order that the Appellant has, in fact, actually received the profit-margin mark up of HPCL. 8. The basis of levy of additional excise duty or differential duty by the Authorities below is that there is no real sale between the Appellant and HPCL, and that the Appellant and HPCL are working on an agency basis and that the final sale price charged by the HPCL to its end-customers, must be treated as the 'transaction value' for the purposes of Sec 4(1)(a) of the Central Excise Act for the purpose of levy, instead of the value adopted by the Appellant, at the time of its clearance to HPC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s applicable. It was held that the relation between the parties is not on principal to principal basis, and what is paid to HPCL, is indeed commission. It was also held that the place of removal as per Sec 4 is the retail outlet. The Appellate Authority sustained the invocation of the extended period of limitation on the ground that the facts would not have come to light, but for verification of the records of the Appellant by the department and that there is a mis-declaration of facts with an intent to evade the payment of Central Excise duty and that the Appellant did not inform the Department about the activities such as installation of equipment and its maintenance at HPCL stations. In the same manner, levy of penalty @ 100% of the tax, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mahanagar Gas Ltd have charged the mutually agreed price, which was the transaction value with respect to sale to OMC in the normal course of their business, and no additional consideration, whatsoever, flows from the OMC to Mahanagar Gas Ltd. Further, by virtue of its technical necessity, supply of CNG could have been done in the manner in which it has been done by Mahanagar Gas Ltd, as natural gas by the process of compression amounts to manufacture, for the purpose of marketing as CNG for use as fuel, which had been done at the time of dispensing. It was further held that the transaction value squarely falls under the provisions of Sec 4(1)(a) of the Act. The Tribunal also held that Assessee can have different transaction value with res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs. Thus, it is Appellant which is selling CNG to the retail customers through HPCL, as the sale price is being determined by the Appellant and not HPCL. It is further urged that CNG price is neither governed by 'Administered Price Mechanism' as prevalent to petroleum products before 01.04.2002 nor CNG is governed by Legal Metrology Act, for fixation of RSP. Further HPCL is not free to sell at any price it chooses and they are entitled to fixed commission as agreed between the parties. Even the electricity charges incurred for installing equipment and accessories thereto required for filling of CNG in vehicles is borne by the Appellant. If the Appellant is selling CNG to HPCL, then why the cost for electricity incurred for retail selling of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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