2026-VIL-237-CESTAT-HYD-CE
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CENTRAL EXCISE CESTAT Cases

Central Excise - Valuation of Compressed Natural Gas (CNG) – Appellant had entered into an agreement with M/s Hindustan Petroleum Corporation Ltd. (HPCL) for utilizing HPCL's retail outlets to sell its CNG - Department invoked the provisions of Rule 7 of the Central Excise Valuation Rules, 2000 and contended that the selling price at the CNG dispensing station installed in the HPCL retail outlet should be the normal transaction value for discharging the excise duty by appellant - Whether the commission/trade margin paid by the appellant to HPCL should be included in the assessable value on the ground that the transactions between BNGL and HPCL are not on a principal-to-principal basis and the price payable by the ultimate customer is always fixed by the appellant - HELD - The issue regarding the inclusion of commission/trade margin in the assessable value had already been decided in favor of the appellant BNGL in the Tribunal's earlier order. The Department had not raised any new grounds or allegations regarding the nature of the transaction or the relationship between appellant and HPCL in the present appeals - The Department's allegation in the SCN was based on the ground that the place of removal of the excisable goods (CNG) was the CNG dispensing stations installed in the HPCL retail outlets, and not the factory gate. The Department had relied on Section 4(1)(a) read with Section 4(3)(c) of the Central Excise Act, 1944 and Rule 7 of the Valuation Rules, 2000, and did not allege in the SCN that appellant and HPCL were related parties. Department cannot now contend that the transactions are covered under Section 4(1)(b) read with Rule 7 on the ground of appellant and HPCL being related parties, as this ground was not raised in the SCN – The impugned orders are set aside and the appeals are allowed
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