Supply of Gases in a Factory by under an BOOT Agreement

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mk (Querist)
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08 May 2009 Dear Sir,

For making Steel in a Factory in Maharashtara, an Oxygen & Nitrogen Gas Plant is required. The Steel Factory wants to invite Vendor of such Oxygen Plant to enter in a BOOT Agreement(Build, Own, Operate & Transfer)whereby the Vendor owns the plant, run it for 2-3 years and then transfer it. During this period they will get the Operation & maintenance Charges for continuous supply of Oxygen & nitrogen Gas of required quantity.

My question are -

In case the Gases - Oxygen & Nitrogen are produced by Vendor, will it require the Excise Reg and payment of Excise Duty by them ? In this case the premises of their plant is in our factory it self so will they get separate Reg ?

In case it attracts Excise Duty then they have to sell the Gases which would also include the VAT ?

In case they are paid monthly fixed charges for continuous supply of gases as Operation & Maintenance, how will it be treated from Excise, Vat and Ser. Tax point ?

The proposed BOOT Agreement provides that the Plant will be the Vendor till it is transferred.

When after 3 years the same is transferred, will it be chargeable to Excise Duty ? Though there is no clearance ? The Plant as assembled and erected is being transferred. ?

Please clarify.

Regards,

MK