Controlled LPG pricing and oil pool compensation defeated differential duty demand under the regulated price mechanism.

Differential duty on domestic LPG was challenged on the basis that the sale price was fixed under the Government's Administrative Price Mechanism and that receipts from the oil pool account were only part of the same compensation scheme. The Tribunal treated the controlled price and the pool-account payment as linked elements of the regulated pricing structure, and noted that the issue had already been decided in favour of the assessee in earlier orders. The Commissioner's demand was set aside, with consequential relief granted.

---

---

Issues: Whether the demand of differential duty was sustainable where the LPG price was fixed under the Administrative Price Mechanism and the amount received from the oil pool account formed the basis of the proposed duty demand.

Analysis: The price at which domestic LPG was sold was fixed by the Government of India under the Administrative Price Mechanism, and the suppliers were required to sell at that controlled price. The amount received through the oil pool account represented compensation mechanism linked to the same scheme. The Tribunal also noted that the same issue had already been decided in favour of the assessee in earlier orders.

Conclusion: The demand confirmed by the Commissioner was set aside and the appeal was allowed with consequential relief.

---