New Delhi, Feb 23 Downstream oil marketing company Bharat Petroleum Corporation Ltd (BPCL) has received an order from the Commissioner of Central Tax and Central Excise, Kochi, for a total demand of Rs 1,816.65 crore, the government-owned company said in an exchange filing on Monday.
The total sum comprises an excise duty demand to the tune of Rs 476.94 crore in addition to the applicable interest of Rs 1,339.70 crore and a penalty of Rs 95,000, it said in a filing with the BSE.
The BPCL said it will analyse the order and file an appeal before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT).
On the details of the litigation, the public sector undertaking (PSU) said that there were 19 Show Cause Notices (SCNs), which were pending for adjudication by the Central Excise Department pertaining to the period between September 2004 and May 2010, under the Central Excise law. The Adjudicating Authority has now given its ruling on these SCNs by passing the order dated February 21, 2026.
The company said a significant portion of the confirmed demand pertained to the pre-merger period of Kochi Refineries Ltd (KRL), specifically from September 2004 to August 2006, which had been pending adjudication.
"The Adjudicating Authority ruled that BPCL and KRL were related parties, so Refinery Gate Price cannot be used for excise valuation, and the department’s valuation under Rule 11 read with Rule 9 of Central Excise Valuation Rules, 2000 is valid. After the merger, BPCL – Kochi Refinery used Rule 7 of Central Excise Valuation Rules, 2000 (highest quantity depot price), but the department applied the highest value of the entire fortnight to all clearances under Rule 11 read with Rule 7 of Central Excise Valuation Rules, 2000," the filing stated.
Shares of BPCL rose by 1.83 per cent to Rs 372.55 at the closing of trading hours, before the announcement regarding the tax demand.
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