When contacted, IOC director finance P Sugavanam confirmed the show cause notice and said the company would move the Customs and Excise Gold Control Appellate Tribunal (CEGAT) against the notice issued by Collector of Customs (port), Calcutta, for alleged customs duty evasion of Rs 975.9 crore.

``We will appeal before the CEGAT by month end,'' Sugavanam said but declined to give further details.

The customs has asked IOC to pay the principal amount (Rs 975.9 crore) along with 100 per cent cent penalty and 20 per cent interest, which would add up to well over Rs 2000 crore.

IOC sources said the company would seek permission of the Committee of Secretaries headed by Cabinet Secretary to appeal against the show cause notice.

This would be the highest ever duty demand made in Indian corporate history by the revenue department for alleged evasion, the sources said.

The Collector of Customs (Port), Calcutta had issued a show cause-cum-demand notice last month to IOC for alleged customs duty evasion on grounds that the company had suppressed ship pre-detention demurrage charges for the period before 1998.

IOC sources, however, said that demurrage charges were being included in the customs value.

Company sources said the Customs Collector (Calcutta) was empowered to hear the case on behalf of all the ports.

The notice charged IOC for suppression of facts and misdeclaration.IOC imports eight petroleum products and the duty demand pertains to only five of the products imported through all the major ports in the country, the sources said.

The five imported products on which the duty demand has been made are Motor Sprit (Petrol), High Speed Diesel (HSD), Superior Kerosone Oil (SKO), Furnace Oil (FO) and Aviation Turbine Fuel (ATF).