Cess valuation under the Oil Industries Act must follow refinery-received quantity, not oilfield production.

Cess under the Oil Industries (Development) Act, 1974 was held assessable on the quantity received in the refinery, because Section 15(2) fixes the taxable incidence by reference to that statutory measure. The Tribunal rejected assessment on the quantity produced in the oil fields, as that approach departed from the charging provision. The impugned order was set aside and the matter remitted for fresh verification of duty payment on the refinery-received quantity, with an opportunity of hearing to the appellants.

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Issues: Whether cess under the Oil Industries (Development) Act, 1974 was leviable on the quantity produced in the oil fields or on the quantity received in the refinery.

Analysis: The dispute turned on the charging provision in Section 15(2) of the Oil Industries (Development) Act, 1974. The relevant provision was treated as clear in fixing the incidence of cess on the quantity received in the refinery. In view of the settled legal position and the charging enactment, the Tribunal rejected the basis adopted by the adjudicating authority, which had proceeded on production in the oil fields for quantification.

Conclusion: The cess is payable on the quantity received in the refinery and not on the quantity produced in the oil fields.

Final Conclusion: The impugned order was set aside and the matter was remitted for fresh verification of duty payment on the refinery-received quantity, with an opportunity of hearing to the appellants.

Ratio Decidendi: Where the charging provision expressly fixes the taxable quantity, cess must be assessed on that statutory measure and not on an administratively adopted alternative basis.

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