Law: Central Excise Act, (I of 1944)

Section: 3

(Central Excises Act (I of 1944)].......S 3 & First Sched., Hdg. 9817.0000---Central Excise Rules, 1944, R-96ZZO ---Excise duty on Services, levy of---Legality---Supply of national gas to consumers by a person, firm or company engaged in supply or distribution thereof---Such Service is an "excisable service" chargeable to Central Excise duty. (b) Central Excises Act (I of 1944)--S.3 & First Sched., Hdg. 9817.0000---Central Excise Rules, 1944, R.96ZZO---S.R.O. 455(I)/96, dated 13-6-1996---Natural Gas Rules, 1960, Rr. 2(c) & 3---Excise duty on Services, levy of---Supply of natural gas to Staff Canteen located at production .fields by appellant--­Company engaged in exploration and production of gas---Adjudicating Officer adjudged such supply to be excisable services, thus, raised demand of duty---Validity---Not sufficient merely that a person engaged in use of gas became a person liable to duty only a person, firm or company engaged in supply or distribution of natural gas could be made liable to duty under S.3 of the Act read with R.96ZZO of Central Excise Rules, 1944---Appellant had never engaged itself in distribution or supply of natural gas to consumers, rather same was engaged in drilling out gas from gas-fields and for carrying on operations of gas drilling, field staff used gas for preparation of foods etc.---Such act of appellant did not fell within framework of excise law---Gas supplied from gas field to on site workers did not fell within definition of "excisable services" as given in S.2(2) of the Act---Duty was chargeable on service charges at the gate of 10% whereas appellant had neither charged its staff nor received any charges---Appellant did not fall within any definitions given in Natural Gas Rules,. 1960---Natural Gas Rules, 1960 provided an exception to a flow line used for transportation or conduct of gas within leased area or from well-head to purification plant or connection with main 'transmission line within such area---Field camps and masses of appellant fell within such exception---Contract with appellant also provided that gas' used at the site and in gas fields would be exempt from domestic taxation, which contractual…

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