Supreme Court Sets Aside Excise Duty Demand On Oil Marketing Companies For Inter-Supply Of Petroleum Products

The Supreme Court of India set aside the excise duty demand on oil marketing companies (OMCs) for inter-supply of petroleum products between different state units. The issue arose when the tax authorities had demanded excise duties on the movement of petroleum products between various branches of the same company. The court ruled that such inter-supply transactions should not be treated as taxable under the excise law. It clarified that these internal transactions did not result in a sale that could attract excise duty. The judgment is significant for the petroleum sector, providing clarity on tax obligations for inter-company transactions and offering relief to OMCs from undue tax demands.