2018 (11) TMI 1156

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....for supply of oxygen gas through pipe lines. As per the agreement entered, the appellant installed pipe line supply systems within the premises of its customers. For such supply of gas through pipe lines, the appellant charged from its customer - (a) variable charges depended upon the quantum of gas supply and (b) monthly charges in the form of "Fixed Facility Charges" as per terms of the agreement. The quantum of gas supplied through pipe lines was measured by making use of meter installed at the boundary wall between the appellant's factory and their customers. Excise duty was being paid by the appellant on the quantity of oxygen gas supplyied as ascertained through the meter. Department was of the view that Fixed Facility Charges recover....

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.... submitted that the Department is not justified in demanding service tax on the entire facility charges recovered from the appellants. (ii) The doubt regarding whether Central Excise duty is to be paid or service tax is to be paid for the facility charges recovered, was requested to be clarified from the jurisdictional Commissioner of Central Excise, BBSR II through the appellant's letter dated 07.01.2014. In respect of their Rourkela Plant, it has been clarified by the Department through their letter dated 21.02.2014 as follows : "To M/s Linde India Ltd., HIG-12,Gangadhar Meher Nagar, Jaydev Vihar, Bhubaneswar-765013 Sub.: Clarification on applicability of Central Excise duty or Service tax on Fixed Facility charges recovered from c....

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....n the appellant's own case for an earlier period was decided by this Tribunal Bench in respect of Excise valuation dispute in the case of BOC India Vs. CCEx., Jamshedpur reported in 2005 (183) ELT 475 (Tri.-Kolkata). The Tribunal decided that the facility charges are not includible in the assessable value for payment of Excise duty. He added that if the charges are not includible in the assessable value, they will be liable to payment of service tax as ordered by the lower authority. 6. Heard both sides and perused the records. 7. As per the facts of the present case, gases are being supplied through pipe lines by the appellant to the customer, M/s Tata Steel Ltd., which is situated in adjacent premises. For this quantum of gases supplied....

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....rence to their unit at Bhubaneswar. The Commissioner of Central Excise, Bhubaneswar vide his letter dated 24.02.2014 clarified that fixed facility charges are part of transaction value for the purpose of Central Excise duty. The facts and circumstances dealt with in these references are similar to the one under consideration. Accordingly, he submitted that the impugned orders are liable to be set aside. 3. The ld. AR reiterated the findings of lower authority and submitted that the applicability of Board clarification dated 10.11.2014 has to be examined. 4. We have heard both sides and perused the appeal records. The appellants are engaged in manufacture & supply of gases liable to Central Excise duty They have put up storage facilities i....