2007 (3) TMI 538 - AT - Central Excise

Summary

Issues involved: Interpretation of the provision of cess under the Oil Industries (Development) Act, 1974 - Whether to be collected on the quantity produced in the oil fields or on the quantity received in the refinery.

The judgment by the Appellate Tribunal CESTAT, KOLKATA, involved multiple appeals (EDM-57, 122, and 138/06) dealing with the issue of whether cess under the Oil Industries (Development) Act, 1974 should be collected on the quantity produced in the oil fields or on the quantity received in the refinery. The Adjudicating Commissioner had held that the quantity produced in the oil fields should be considered for quantifying the cess. However, the appellants argued, citing Section 15(2) of the Oil Industries (Development) Act, 1974, that the duty of excise should be collected on the quantity received in a refinery, as supported by a previous Tribunal decision.

After considering the legal position and the provisions of the Oil Industries (Development) Act, 1974, the Tribunal concluded that the cess under the Act should indeed be collected on the quantity received in the refinery, not on the quantity produced in the oil fields. Consequently, the impugned Order was set aside, and the matter was remanded to the Original Authority for verification of correct duty payment on the quantity received in the refinery in each case. The appellants were granted a reasonable opportunity of hearing before a fresh order is passed, allowing them to submit relevant case law.

In a decision on all the appeals, the Tribunal allowed them by way of remand, and the three Stay Petitions were also disposed of accordingly. The judgment was dictated and pronounced in the Open Court by the Tribunal.