Oil India Updates Tax Litigation Statuses Involving Union of India and State of Assam

Oil India Updates Tax Litigation Statuses Involving Union of India and State of Assam​

Oil India Limited has provided updates regarding ongoing tax litigations, detailing the status of two major disputes concerning Goods and Services Tax (GST) and state land taxes.

The company maintains that GST is not payable on royalty paid under the Oil Fields (Regulation & Development) Act, 1948, in a dispute with the Union of India. The litigation began on February 3, 2024, before the Hon'ble Supreme Court of India. This case originated from a writ petition filed in the Gauhati High Court, which referenced an interim order dated November 2, 2021.

The subject matter revolves around a levy where CBIC FAQs stated that GST is payable on Royalty paid for assignment of right to use natural resources. Oil India Limited contends that this levy is unwarranted. These cases were transferred from respective High Courts and admitted before the Supreme Court on February 3, 2024 (T.P.(C) No. 000300 - 000304 / 2024).

As per an order dated July 29, 2026, counsel for Oil India Limited informed the court that OIL would deposit GST as per law within six weeks. This payment remains subject to the final outcome of the proceedings and was directed to be tagged with C.A. No. 10560/2025 (Udaipur Chamber of Commerce and Industry vs. Union of India).

State Tax Litigation Status Update​

Oil India Limited is also contesting a dispute with the State of Assam, which began on June 6, 2020, before the Hon'ble Supreme Court of India. This litigation challenges the Assam Taxation (on Specified Lands) Act, 1990, as amended by the Assam Taxation (on Specified Lands) (Amendment) Act, 2004.

The amendment mandated that an oil producer must pay Rs. 200/- per metric tonne for Crude Oil and Rs. 100/- per thousand cubic meters of annual productivity for Natural Gas. The Government of Assam has raised a demand totaling approximately Rs. 2484.81 crores for the period 2005-2024, which OIL contests as being ultra vires the Constitution of India.

Regarding this matter, the State of Assam informed the court on July 29, 2026, that it intends to withdraw the specific land tax and will move an appropriate bill in the State Legislature for this purpose. Consequently, the Hon'ble Supreme Court disposed of Transferred Case (C) No. 232 of 2020 and Writ Appeal No. 599/2005 that were pending before the Gauhati High Court, along with all pending interlocutory applications.

OIL Stock Price Movement​

Oil India Limited shares today slipped by 1.33% to close at ₹444, as the company shed ₹6.00 from its previous closing price. The stock traded with a volume of 3.93 million shares during the session.