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TMI Blog2017 (10) TMI 334X X X X Extracts X X X X X X X X Extracts X X X X ..... provisions were withdrawn. This has been recorded in the impugned order also - The only point is that the MS and HSD in the bonded pipeline as existing on 6.9.2002 got cleared when other petroleum products which were duty-paid were moved through the same pipeline. To that extent, the claim of the appellant that the warehouse quantity was in existence in the pipeline was not technically correct. However, equivalent quantity was only presumed to be in the pipeline as and when the MS and HSD was transmitted through the same. The present confirmation of demand of duty for pipeline quantity as on 6.9.2002 is sustainable as the said quantity has been cleared when other products were pumped through the pipeline. However, since the appellants ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the terminal. 2. The dispute in the present case relates to non-payment of excise duty on the quantum of MS and HSD available in the pipeline on the date of de-bonding the tanks for storage of MS and HSD. The Revenue proceeded against the appellant to demand and recover the duty on these products lying in the pipeline on the date of de-bonding. The contention of the Revenue is that the pipelines being common, the appellant should have de-bonded the MS and HSD in the pipeline also, instead, later on, when SKO and Naphtha were pumped through the same pipeline, the non-duty paid MS and HSD got cleared and mixed up with duty paid MS and HSD. The appellants followed the provisions of de-bonding and warehousing by not paying duty on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en if it is considered that the de-bonding of pipeline along with storage tank should have been done by the appellant on 6.9.2002 itself, the duty demand as confirmed in the present proceedings is lower than what has been paid at the closure of warehousing provision in 2004. At best, interest liability on the earlier demand can arise. Even after that, the appellant shall be eligible for a refund of excess amount. 3.1 Regarding imposition of penalty under Rule 25, the learned counsel submitted that there is no ground for such penalty. The appellant is a Public Sector Undertaking and they have been following the warehousing provision for many decades. The procedure followed and bonding of pipeline are all in the course of normal transactio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the above factual position, we find that the present confirmation of demand of duty for pipeline quantity as on 6.9.2002 is sustainable as the said quantity has been cleared when other products were pumped through the pipeline. However, since the appellants have conceded that MS and HSD of equivalent quantity as deemed to have been bonded for the period after 6.9.2002 till the warehousing provisions were withdrawn, the duty paid latter should be adjusted against the present demand along with the interest as applicable. Here the learned counsel submitted that they have already filed their claim for excess duty, which is reported to be pending. The same will be dealt with separately in terms of provisions of Section 11B of the Central Excis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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