Central Excise slaps Rs 4.6 crore tax notice on Indian Oil

The Directorate General of Central Excise Intelligence (DGCEI) has issued a show cause-cum-demand notice of over Rs 4.6 crore to the nation's largest oil firm Indian Oil Corporation for not paying service tax under the head of a 'goods transport agency'.

"We had issued a notice to IOC last month for tax liability of Rs 4.64 crore and the oil major has to reply by May 24," said a DGCEI source.

IOC will have to reply why the amount of Rs 4.64 crore along with interest, penalty and additional penalty for suppressing the value of toll charges paid to the transporters should not be charged, said the notice issued by Additional Director-General of DGCEI Samanjasa Das.

Das said IOC has not been paying their tax properly as a goods transport agency by not including toll charges paid to its transporters as actual expenses in the taxable value between October 2008 and September 2013.

Das also said the transporters involved are plying their trucks on various routes for transporting the goods of IOC and that there are certain roads where toll charges are collected from these vehicles.

"Without payment of the impugned toll charges, the goods carriage cannot use the said road and hence, the transporter cannot provide the impugned services of a goods transport agency without paying toll charges," the notice added.

Hence, the notice said, the expenditure incurred by the transporter becomes an intrinsic part of the cost of transportation, as without incurring the expenditure on toll charges, the provision of service of a goods transport agency is not possible.

Therefore, the toll charges cannot be disintegrated from the value of taxable services of a goods transport agency as they are inextricably connected with the service provided, the notice said.

When contacted, IOC spokesperson refused to comment.

Post new comment

E-mail ID will not be published
CAPTCHA
This question is for testing whether you are a human visitor and to prevent automated spam submissions.

EDITORIAL OF THE DAY

  • Prabhu Express has trundled into town with a cargo of feel-good promises

    Railway minister Suresh Prabhu, punning on his own name, sought divine intervention more than once while delivering his maiden rail budget last Thursd

FC NEWSLETTER

Stay informed on our latest news!

INTERVIEWS

GV Nageswara Rao

MD & CEO, IDBI Federal Life

Timothy Moe

Goldman Sachs

Chander Mohan Sethi

CMD, Reckitt Benckiser India

COLUMNIST

Urs Schoettli

The hidden attractions of Japan

We live in the Asian century. During the past two ...

Zehra Naqvi

Star power

Being a part of the generation that gorged on Shah ...

Bubbles Sabharwal

The waking moment decides the day

There was a little girl/ Who had a little curl/ ...

INTERVIEWS

William D. Green

Chairman & CEO, Accenture