CCE & ST v. Gas Authority of India Ltd.

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The Tax Publishers2019 TaxPub(EX) 355 2018 (366) E.L.T. 941 CCE & ST v. Gas Authority of India Ltd. CENTRAL EXCISE TARIFF ACT, 1985 --Classification of goods--Mis-declaration of productsNatural Gasoline Liquid (NGL) as "Naphtha” ----Chemically NGL and Naphtha were two different products having overlapping physical and chemical properties but the key differences have when seen in relation with the statements on record have established it beyond doubt that product manufactured by assessee was natural gasoline liquid which attracted duty at the rate of 14 per cent ad volerum + Rs. 15 per liter and not Naphtha.--Assessee was engaged in the transportation of natural gas through pipelines and were also engaged in manufacture of petroleum gases and other gaseous hydrocarbons, petroleum oils and oils obtained from bituminous minerals other than crude falling under Chapter heading 2710. Department observed that assessee was mis-declaring one of the products that is "Natural Gasoline Liquid" (NGL) as "Naphtha" at the time of clearance from their factory premises NGL has a specific entry as 2710 12 20 which attracts duty of 14 % ad volerum + Rs. 15 per liter whereas Naphtha has specific entry 2710 11 90 and that it attracted the duty at the rate of 14 per cent ad volerum by along with the benefit of exemption under Notification No. 18/2009/CE, dated 7-7-2009. Department alleged that assessee by such mis-declaration have short paid the duty on manufacturing and clearance of NGL. *Held:* Chapter heading 2710 old 6 digit Tariff, which existed in 2005 there was a specific sub heading 2710 14 for Naphtha and 2710 15 for NGL, both were the products grouped under broad heading of motors spirit, however, in the present dejected Tariff entry of Naphtha was removed and natural gasoline liquid was grouped under a variety of light oils and preparations and continues to exist being classified under Tariff item 2710 12 20. Supplementary note (b) of Chapter 27 of CETA defines NGL as a low boiling liquid petroleum product extracted from natural gas. NGL has been separated from the group of Motors sprits. Earlier NGL, SBPS and Naphtha all were under the Tariff Group of Motors spirits. Product in hand was NGL having a specific definition in the Tariff. Thus product manufactured by assessee was natural gasoline liquid which attracted duty at the rate of 14 per cent ad volerum + Rs. 15 per liter and not Naphtha. SUBSCRIBE FOR FULL CONTENT

The Tax Publishers2019 TaxPub(EX) 355 2018 (366) E.L.T. 941

CCE & ST v. Gas Authority of India Ltd.

CENTRAL EXCISE TARIFF ACT, 1985

--Classification of goods--Mis-declaration of productsNatural Gasoline Liquid (NGL) as "Naphtha” ----Chemically NGL and Naphtha were two different products having overlapping physical and chemical properties but the key differences have when seen in relation with the statements on record have established it beyond doubt that product manufactured by assessee was natural gasoline liquid which attracted duty at the rate of 14 per cent ad volerum + Rs. 15 per liter and not Naphtha.--Assessee was engaged in the transportation of natural gas through pipelines and were also engaged in manufacture of petroleum gases and other gaseous hydrocarbons, petroleum oils and oils obtained from bituminous minerals other than crude falling under Chapter heading 2710. Department observed that assessee was mis-declaring one of the products that is "Natural Gasoline Liquid" (NGL) as "Naphtha" at the time of clearance from their factory premises NGL has a specific entry as 2710 12 20 which attracts duty of 14 % ad volerum + Rs. 15 per liter whereas Naphtha has specific entry 2710 11 90 and that it attracted the duty at the rate of 14 per cent ad volerum by along with the benefit of exemption under Notification No. 18/2009/CE, dated 7-7-2009. Department alleged that assessee by such mis-declaration have short paid the duty on manufacturing and clearance of NGL. Held: Chapter heading 2710 old 6 digit Tariff, which existed in 2005 there was a specific sub heading 2710 14 for Naphtha and 2710 15 for NGL, both were the products grouped under broad heading of motors spirit, however, in the present dejected Tariff entry of Naphtha was removed and natural gasoline liquid was grouped under a variety of light oils and preparations and continues to exist being classified under Tariff item 2710 12 20. Supplementary note (b) of Chapter 27 of CETA defines NGL as a low boiling liquid petroleum product extracted from natural gas. NGL has been separated from the group of Motors sprits. Earlier NGL, SBPS and Naphtha all were under the Tariff Group of Motors spirits. Product in hand was NGL having a specific definition in the Tariff. Thus product manufactured by assessee was natural gasoline liquid which attracted duty at the rate of 14 per cent ad volerum + Rs. 15 per liter and not Naphtha.