2025-VIL-1835-CESTAT-HYD-CE
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CENTRAL EXCISE CESTAT Cases

Central Excise - Supplies to companies awarded oil/gas blocks under ICB, Exemption under Notification No. 6/2006-CE - Appellant claimed that the goods were supplied to companies like Reliance Industries Ltd. (RIL) engaged in oil exploration activities in the KG basin, which were exempted under Notification No. 21/2002-Cus and Notification No. 6/2006-CE as the supplies were for projects awarded under International Competitive Bidding (ICB) - Whether the Appellant is eligible for the exemption under Notification No. 6/2006-CE for the supplies made to the companies engaged in oil exploration activities awarded under ICB – HELD - The Appellant had provided the project authority certificates issued by RIL, which certified that the goods supplied by the Appellant were required in connection with petroleum operations undertaken under petroleum exploration license or mining lease under ICB. The adjudicating authority had wrongly tried to distinguish between the exploration of oil field and petroleum operation, which is not borne out by the correct appreciation of the project authority certificate - The clarification received by the Appellant from the Director General of Hydrocarbons that the awards of oil and gas blocks are made through ICB under the New Exploration License Policy (NELP). Further, the purchase orders issued by RIL as the operator clearly mentioned that there is no excise duty applicable on the items for which the order is being placed, indicating that the supplies were for the project awarded under ICB. Therefore, the Appellant, as a sub-contractor, is also eligible for the exemption under Notification No. 6/2006-CE for the supplies made to the companies engaged in oil exploration activities awarded under ICB - The documents adduced by the appellant are sufficient to indicate that the supplies were intended for use only in connection with the activity for which the work was awarded through ICB route to M/s RIL as operator. Therefore, the appellants are entitled for the benefit of notification claimed by them for non-payment of Central Excise duty – The impugned order is set aside and the appeal is allowed
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