ALOK SHARMA,J. - (1.) The petitioner Cairn India Limited (hereinafter 'the petitioner') is engaged in the business of exploration and production of crude oil and natural gas in block RJ-ON-90/1 in district Barmer, Rajasthan. It is a mining company registered as a dealer under the Rajasthan Value Added Tax Act, 2003 (hereinafter 'the Act of 2003'). The petitioner entered into a Production Sharing Contract (PSC) with the Government of India on 15-5-1995. As in terms of Article 297 of the Constitution of India, petroleum in its natural state vests in the Union of India, under Article 18 of the PSC the sale and disposal of crude oil and condensate from block RJ-ON-90/1 in district Barmer, Rajasthan had to be sold by the petitioner only to the Government of India and its nominees. As per letter dated 24-3-2009 emanating from the Ministry of Petroleum and Natural Gas, Government of India, it initially nominated Mangalore Refinery and Petrochemicals Limited (MRPL), HPCL, and IOCL for lifting purchase of crude oil extracted by the petitioner from RJ-ON-90/1 Barmer. Production of crude oil started at the Mangla field of (RJ-ON-90/1 in district Barmer, Rajasthan) (hereinafter 'the Barmer Oil Fields) on 29-8-2009. Since then Essar oil, Reliance Industries etc. have also been nominated by the Government of India to buy crude oil from the petitioner produced at the Barmer fields.
(2.) The petitioner entered into a memorandum of understanding in respect of crude oil produced in the Barmer Oil Fields with MRPL on 5-8-2009. Under the modus operandi, then obtaining, crude oil produced by the petitioner company and sold to the nominees of the Government of India was dispatched in heated insulated via road tankers from the Barmer Oil Fields to Kandla (coastal area in Gujarat) where it was stored in tanks (heated chambers) wherefrom it was thereafter loaded onto oil tankers(coastal heated tanker) for being further carried to Mangalore via a coastal run to MRPL's refinery. The petitioner states to have since then laid heated pipeline from Barmer, Rajasthan to Bhogat (Gujarat coast) operationalised in July, 2010, the Central Government has also approved with some intermediary delivery facilities (all in Gujarat State). All such enroute points are regarded as delivery points identified by the Central Government under clause 1.23 of the PSC. As per Article 1.23 of the PSC a "?delivery point "? is defined as the outlet flange of the delivery facility at Barmer or any other point as identified by the Government of India. MOPNG vide letter dated 30-4-2008 had first provided for the delivery point at Salaya, Gujarat, (subsequently at Bhogat, Gujarat vide letter dated 24-7-2009) for reason of convenience and logistics of transportation of crude oil to the buyers nominated by the Central Government, as buyers of the petitioner's crude oil had refineries for the purpose of processing crude oil outside the State of Rajasthan.
(3.) The Government of Rajasthan concerned with the shifting of delivery point/s for the sale of Barmer Crude oil outside the state of Rajasthan was apprehensive that such shifting would entail loss of sales tax revenues to the State Government and corresponding windfall gain to the Government of Gujarat. To eschew the aforesaid concerns, the petitioner vide letter dated 23-10-2008 addressed to the Secretary MOPNG stated that the point of sale of crude oil produced at the Barmer Oil Fields would be in Rajasthan and it would advise buyers nominated by the Central Government to set up their branches in Rajasthan to ensure that despite the shifting of the point of delivery of crude from Barmer to Salaya in Gujarat as recommended by the Empowered Committee of Secretaries (ECS) it would not lead to undue loss of revenue to Government of Rajasthan and corresponding windfall gain to the State of Gujarat. The Government of India also conveyed this fact to the State of Rajasthan vide letter dated 14-1-2009. Resultantly vide letter dated 22-1-2009 the Director Petroleum, Government of Rajasthan required the petitioner to submit an undertaking that the crude oil off take point from the Barmer Oil Fields would be in Rajasthan and that the petitioner would ensure that such a clause was incorporated in the Crude Oil Sales Agreements (COSAs) executed by the petitioner with the buyers nominated by the Central Government. Vide letter dated 23-1-2009, the Chief counsel of the petitioner informed the Director, Petroleum Government of Rajasthan that arrangement, as required, pertaining to crude oil off take in Rajasthan would be incorporated in the COSAs with the buyers to ensure that point of sale of crude oil would remain in Rajasthan.;