Bharat Petroleum Corporation Ltd. (BPCL) has received an Order from the Commissioner of Central Tax and Central Excise, Kochi, dated February 21, 2026. The order pertains to 19 Show Cause Notices concerning excise valuation disputes dating back to September 2004 to May 2010. The total expected financial implication is substantial, estimated at ₹1,816.65 Crores, primarily comprising duty and interest. BPCL intends to file an appeal against this order before the CESTAT.
Regulatory Disclosure Update
Bharat Petroleum Corporation Limited (BPCL) has formally notified exchanges regarding an Order received from the Commissioner of Central Tax and Central Excise, Kochi. This order, dated February 21, 2026, addresses pending adjudication matters related to the Central Excise law.
Details of the Dispute and Implication
The dispute involves 19 Show Cause Notices (SCNs) pending adjudication, related to the transaction value used for excise purposes during the period from September 2004 to May 2010. The Adjudicating Authority (AA) has now passed an order concerning these historical notices.
Financial Exposure
The total expected financial implication stemming from this ruling is significant, calculated at Rs.1,816.65 Crores. This figure is broken down as follows:
- Duty: Rs.476.94 Crores
- Applicable Interest up to date (approx.): Rs.1,339.70 Crores
- Penalty: Rs.95 thousand
The major demand confirmed relates to the pre-merger period of Kochi Refineries Limited (KRL), spanning from September 2004 to August 2006.
Basis of the Adjudication Ruling
The AA ruled that BPCL and KRL were deemed related parties. Consequently, the Refinery Gate Price could not be used for excise valuation. The department’s valuation method, applying the highest value of the entire fortnight under Rule 11 read with Rule 7 of the Central Excise Valuation Rules, 2000, was deemed valid.
Way Forward
BPCL has confirmed that it will proceed to analyze the order thoroughly. Following this analysis, the Company plans to file an appeal against the decision before the Hon’ble Customs, Excise And Service Tax Appellate Tribunal (CESTAT).
Source: BSE
