2023 (6) TMI 641 - AT - Central Excise

Valuation - supply by the retail outlets by providing infrastructure such as, tank, pumps, building etc. based on the requirements of such RPO - inclusion of rent recovered (Service Station Licence Fee 'SSLF') by the appellant in the assessable value for the purposes of levy of excise duty - HELD THAT - In the appellant s own case INDIAN OIL CORPORATION LTD. VERSUS COMMISSIONER OF C. EX., CHENNAI 2006 (9) TMI 440 - CESTAT, CHENNAI , this Tribunal has held SSLF collected by the assessee from their dealers was in the nature of rental on land, tanks, pumps and kiosks installed by the former for the benefit of the latter. A similar fee was collected by M/s. Hindustan Petroleum Corporation Ltd. (HPCL, for short) from some of their dealers and the same was held to be not includible in the assessable value of the petroleum products supplied by M/s. HPCL to such dealers, by the Commissioner (Appeals), Mangalore. And the same was taken up by this Tribunal in the case of BPCL VERSUS COMMISSIONER OF CENTRAL EXCISE, COCHIN 2003 (9) TMI 168 - CESTAT, BANGALORE where it was held that It is clear from the facts of the case that leasing out of outlets and sale of MS and HSD oil are separate transactions between the appellants and their buyers of MS and HSD. This is clear from the fact that no licence fee is levied from the dealers who have not leased out the outlets of the appellants. In the circumstances, it has to be held that licence fee, which is for a different transaction and consideration than the sale of MS and HSD cannot form part of the assessable value of MS and HSD. Thus, he issue is no more res integra. Accordingly, the SSLF is not includable in the assessable value - appeal allowed.

Summary

Issues Involved:
The appeal against the impugned order regarding inclusion of Service Station Licence Fee (SSLF) in the assessable value for the purposes of levy of excise duty.

Summary:
The appellant, a Public Sector Undertaking engaged in marketing petroleum products, recovered rent under SSLF charges from RPO dealers for providing infrastructure, such as tanks and pumps. Adjudicating authority issued notices questioning the inclusion of SSLF in assessable value for excise duty. The appellant relied on previous Tribunal decisions where SSLF was held not includable in transaction value. After hearing submissions, the Tribunal found SSLF not includable in assessable value based on past precedents and Supreme Court affirmation.

Detailed Judgment:
The appellant, a Public Sector Undertaking marketing petroleum products, recovered rent under SSLF charges from RPO dealers for providing infrastructure. Adjudicating authority issued notices questioning SSLF inclusion in assessable value for excise duty. Appellant cited previous Tribunal decisions where SSLF was held not includable in transaction value. Tribunal found SSLF not includable in assessable value based on past precedents and Supreme Court affirmation. The impugned order was set aside, and the appeal was allowed with consequential relief to the appellant.