Background:
The 56th GST Council meeting held on September 03, 2025 in New Delhi under the chairpersonship of the Union Finance & Corporate Affairs Minister Smt. Nirmala Sitharaman recommended that goods specified in the List required in connection with petroleum operations or coal bed methane operations shall be subject to IGST at 18% instead of 12%.
Goods specified in the List required in connection with :
(1) Petroleum operations undertaken under petroleum exploration licenses or mining leases, granted by the Government of India or any State Government to the Oil and Natural Gas Corporation or Oil India Limited on nomination basis, or
(2) Petroleum operations undertaken under specified contracts, or
(3) Petroleum operations undertaken under specified contracts under the New Exploration Licensing Policy, or
(4) Petroleum operations undertaken under specified contracts under the Marginal Field Policy (MFP), or
(5) Coal bed methane operations undertaken under specified contracts under the Coal Bed Methane Policy.
Now:
The CBIC vide Notification No. 36/2025-Customs dated September 17, 2025 notifies the IGST rates from 12% to 18% on specified goods required in connection with petroleum operations and coal bed methane operations, w.e.f. September 22, 2025, as recommended by the 56th GST Council meeting held in New Delhi.
In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962) and sub-section (12) of section 3 of Customs Tariff Act, 1975 (51 of 1975), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby makes the following further amendments in the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 50/2017-Customs, dated the 30th June, 2017, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 785(E), dated the 30th June, 2017, namely:- In the said notification, in the Table, against S. No. 404, for the entry in column (5), the entry “18%” shall be substituted. 2. This notification shall come into force on the 22nd day of September, 2025.
Table
| S. No. | Chapter or Heading or sub–heading or tariff item | Description of goods | Standard rate | Integrated Goods and Services Tax | Condition No. |
|
(1) |
(2) | (3) | (4) | (5) | (6) |
| 404. | 25, 27, 28, 29, 31, 34, 35, 36, 38, 39, 40, 56, 69,73, 74, 82, 84, 85, 87, 89 or 90 | Goods specified in column (3) of List 33 when imported by a specified person, in relation with petroleum operations or coal bed methane operations undertaken under:
(a) petroleum exploration licenses or mining leases (b) the New Exploration Licensing Policy (c) the Marginal Field Policy (MFP) (d) the Coal Bed Methane Policy (e) the Hydrocarbon Exploration Licensing Policy (HELP) or Open Acreage Licensing Policy (OALP) Explanation.- – For the purposes of this notification, a specified person is a licensee, lessee, contractor or sub-contractor, as defined below:- (i) ‘licensee’ means a person authorised to prospect for mineral oils (which include petroleum and natural gas) in pursuance of a petroleum exploration license granted under the Petroleum and Natural Gas Rules, 1959 made under the provisions of the Oilfields (Regulation and Development) Act, 1948 (53 of 1948) (ii) ‘lessee’ means a person authorised to mine oils (which include petroleum and natural gas) in pursuance of a petroleum mining lease granted under the Petroleum and Natural Gas Rules, 1959 made under the provisions of the Oilfields (Regulation and Development) Act, 1948 (53 of 1948) (iii) ‘contractor’ means a company (Indian or foreign) or a consortium of companies with which the Central Government has entered into an agreement in connection with petroleum operations (consisting of prospecting for or extraction or production of mineral oils) to be undertaken by such company or consortium (iv) ‘sub-contractor’ means a person engaged by licensee/lessee or contractor for the purpose of conducting petroleum operations on behalf of such licensee/lessee or contractor, as the case maybe |
NIL | 12% to 18% |
48 |
The Notification can be accessed at: https://a2ztaxcorp.net/wp-content/uploads/2025/09/N-No.-36-2025-Customs.pdf
