HPCL Vs. THE COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) IN terms of the impugned order, the appellants are required to pre -deposit the following sums:

(2.) THE appellants are engaged in the business of refining crude and marketing of petroleum products. They have a terminal at Hasan and have taken service tax registration under the category of storage and warehousing service for the safe keeping stocks of Oil Marketing Companies (ONCs). In terms of the Petroleum Products & Supply Distribution Order 1972, issued under Section 3 of the Essential Commodities Act, Oil Marketing Companies like HPC, IOC and BPC are under obligation to make available petroleum products in such places as per the direction of Govt of India. The Govt of India had nominated the appellant to market the products of MRPL in and around the Sate of Karnataka. Pipe lines are used as a safe means of transportation of the products. A Joint Venture Company MHB Ltd., (PMHB) was promoted by the appellants for the operation of Mangalore -Hasan -Bangalore pipeline with construction of oil terminal by the appellants at Hasan. PMHB is also registered assessee and are charging service tax for the transportation of the oil through pipelines. The appellants have reimbursed the service ax charged by PMHB and have taken cenvat credit of the same for payment of their output service tax under "Storage and warehousing" Revenue proceeded against the appellants on the ground that they are not entitled to take credit of the service tax paid on the transportation of their own goods. The Commissioner has denied the said input service tax credit on the following grounds.

(3.) LEARNED JCDR stated that the transportation of the products through the pipeline belonging to the appellants can by no stretch of imagination be called as input service in respect of the output service provided to the other companies.