TaxTMI 
TaxTMI 
2018 (9) TMI 24
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....5. During scrutiny of the record, department noticed that the appellant determined the interface quantity of Superior Kerosene Oil (SKO for short) which was supplied through pipeline with Motor Spirit (MS for short) and High Speed Diesel (HSD for short). The appellant paid duty on such interface quantity of adopting assessable value of SKO (non Public Distribution System (PDS) at the prevalent rate. The case of the department is that the appellant, instead of paying excise duty on the interface quantity of SKO as per rate prevalent for SKO, they should have paid excise duty higher of the two duties, after determining the duty payable on SKO and duty payable on MS/HSD. The contention of the department is solely based on CBEC Circular No. 636....
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.... Act, 1944. In this regard, he submits that there is no charge in the show cause notice that there is any activity after removal of the goods which amount to manufacture, therefore, findings regarding manufacture of goods is beyond the scope of show cause notice. Moreover, the Adjudicating Authority relied upon clause (iii) of Section 2(f), the said clause is applicable only in respect of goods which are specified under Third schedule, whereas the product in question do not fall under Third schedule. Therefore, the demand on the basis of clause (iii) of Section 2(f) is without authority of law. 3. Shri Sameer Chitkara, ld. Additional Commissioner (AR) appearing for the Revenue/respondent reiterates the findings of the impugned order. 4. W....
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....Customs, New Delhi Subject : Movement of petroleum products through pipeline - Determination of duty on interface quantity. The problem of accountal of petroleum products resulting from intermingling of different products pumped through pipelines has been engaging the attention of the Board for quite some time. In a recent case, one of the oil companies has represented against the differential duty demanded by the Department on account of shortage of Superior Kerosene Oil (SKO) imported under concessional rate of duty. It has been contented that the movement of petroleum products through pipelines is carried out by product to product method of pumping and in such an event, co-mingling of one product with another is inevitable. The case....
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...., the duty of inter mixed part of SKO and MS/HSD as the case may be, may be quantified and higher of the two values may be accepted. The existing instructions on the subject stand modified to the above extent. " On careful reading of the above Circular, we find that the Circular suggests that even on clearance of SKO, the price of HSD/MS should be applied. However, this proposal of the Board Circular does not flow from any statutory provision. As discussed above, the appellant have correctly applied the price of respective goods cleared from the factory at the time of removal. Therefore, we do not find any support of any statutory provisions in the Board Circular. The Hon'ble Supreme Court time and again held that the board Circular ca....