News Release Details

Press Release on HSD & MS Prices
New Delhi 25-Jul-2012

The Government of India vide its notification No.P-20029/18/2001-PP dated 16th January , 2003, notified "The Irrecoverable Taxes Compensation Scheme", 2002 to compensate the oil companies for irrecoverable state taxes to facilitate smooth transition from the administered pricing regime to the market determined pricing scheme.

The scheme provided for compensation to Oil marketing and Refining companies in respect of irrecoverable state taxes levied by the States/ local authorities such as Entry Tax on Crude, Surcharge on sales tax, CST/Purchase tax on inter company sales of petroleum products and any other irrecoverable taxes. The compensation was set off with the amount being collected by OMCs through the consumer selling price under the head 'State Surcharge' for the period 2002-03. The 'state surcharge' element in the price build up ensured that the incidence of any irrecoverable tax of the particular state was recovered from the respective state. The rate of 'State Surcharge' has remained unchanged since then.

Over the last several years, oil companies have been suffering increasing level of under-recoveries on account of irrecoverable taxes because of following reasons :

a) New irrecoverable levies by State Governments
b) Changes in State tax structures etc
c) Steep increase in the prices of crude oil and petroleum products in the international markets and consequential increase on the taxes
d) Increase in Retail Selling Prices of the petroleum Products and consequential increase of the taxes

As a result of the above mentioned factors, the irrecoverable taxes have undergone reduction in some states and increase in others. Thus, there was a need to review the said scheme to make the levy rational on a state-to-state basis to reflect reduction in prices in states where the irrecoverable taxes have undergone decrease and effect increase in prices in states where the said taxes have been increased as well as to reduce the burden of the OMCs on account of irrecoverable taxes. Accordingly it has been decided to implement the revised structure of 'state specific cost (SSC)' to cover the irrecoverable taxes w.e.f midnight of 24/25 July, 2012.

As a result of the said revision, HSD prices shall stand reduced in 11 states. SKO(PDS) prices shall stand reduced in 9 states, LPG(Dom) prices shall stand reduced in 12 states and MS Prices shall stand reduced in 11 States. Similarly, HSD Prices shall stand increased in 7 states, SKO(PDS) prices shall stand increased in 8 States, LPG(Dom) prices shall stand increased in 6 States and MS Prices shall stand increased in 7 States.

The Impact of the revision (excluding state levies) in some of the states is given in the table below :

Price Decrease :

State	HSD	SKO(PDS)	LPG (Dom)	MS
	*Rs./litre*	*Rs./litre*	*Rs./Cyl*	*Rs/ litre*
Karnataka	0.62	-	-	1.06
Goa	0.40	-	-	0.82
Gujarat	0.40	0.16	10.18	0.81
Jharkhand	-	0.14	-	0.55
Tamil Nadu	-	-	7.01	0.76
West Bengal	-	0.06	3.86	-
Odisha	0.32	0.07	4.15	0.52

Price Increase :

State	HSD	SKO(PDS)	LPG (Dom)	MS
	*Rs./litre*	*Rs./litre*	*Rs./Cyl*	*Rs/ litre*
Assam	1.95	0.80	19.43	2.13
Bihar	1.45	0.75	9.16	0.80
West Bengal	0.78	-	-	2.02
Maharashtra	0.72	0.32	8.72	0.72

The said scheme shall be reviewed on quarterly basis by the industry and required changes will be made in the State Specific Cost.

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By using the Site, you agree to follow and be bound by the following terms and conditions concerning your use of the Site. IndianOil may revise the Terms of Use at any time without notice to you. Areas of the Site may have different terms of use posted. If there is a conflict between the Terms of Use and terms of use posted for a specific area of the Site, the latter shall have precedence with respect to your use of that area of the Site.
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All content present on this site is the exclusive property of IndianOil. The software, text, images, graphics, video and audio used on this site belong to IndianOil. No material from this site may be copied, modified, reproduced, republished, uploaded, transmitted, posted or distributed in any form without prior written permission from IndianOil. All rights not expressly granted herein are reserved. Unauthorized use of the materials appearing on this site may violate copyright, trademark and other applicable laws, and could result in criminal or civil penalties. IndianOil is a registered trademark of Indian Oil Corporation Ltd. This trademark may not be used in any manner without prior written consent from IndianOil.
IndianOil does not make any warranties, express or implied, including, without limitation, those of merchantability and fitness for a particular purpose, with respect to any information, data, statements or products made available on the Site.
The Site, and all content, materials, information, software, products and services provided on the Site, are provided on an "as is" and "as available" basis. IndianOil expressly disclaims all warranties of any kind, whether express or implied, including, but not limited to, the implied warranties of merchantability, fitness for a particular purpose and non-infringement.
IndianOil shall have no responsibility for any damage to User's computer system or loss of data that results from the download of any content, materials, information from the Site.
IndianOil may change or discontinue any aspect of its website at any time, including, its content or features. IndianOil reserves the right to change the terms and conditions applicable to use of the Site. Such changes shall be effective immediately upon notice, which shall be placed on the Site.
In no event will IndianOil be liable for damages of any kind, including without limitation, direct, incidental or consequential damages (including, but not limited to, damages for lost profits, business interruption and loss of programs or information) arising out of the use of or inability to use IndianOil's website, or any information provided on the website, or in the Products any claim attributable to errors, omissions or other inaccuracies in the Product or interpretations thereof. Some jurisdictions do not allow the limitation or exclusion of liability. Accordingly, some of the above limitations may not apply to the User.
User agrees to indemnify, defend and hold IndianOil harmless from and against all losses, expenses, damages and costs, including reasonable attorneys' fees, arising out of or relating to any misuse by the User of the content and services provided on the Site.
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