Madras HC grants interim order against diesel price hike for STC

Injunction was on a petition by TNSTC against dual pricing for bulk and retail diesel

The Madras High Court has granted an interim injunction against oil marketing companies charging the increased bulk diesel price which was announced on January 17, 2013, from the State Transport Corporation.

The injunction was on a petition filed by the Tamil Nadu State Transport Corporation (TNSTC) against dual pricing for bulk and retail diesel.

Admitting the petition filed by the secretary of State Transport Corporation, Justice S Rajeswaran issued notice to the Union Ministry of Petroleum Managing Directors of Hindustan Petroleum Corporation Limited, Bharat Petroleum Corporation Limited and Indian Oil Corporation Limited.

TNSTC, in its petition said that the decision to partially deregulate the diesel price, was aribtrary, inflationary and discriminatory. It also argued that the corporation is already in loss and the dual price hike has added an additional burden of Rs 8.5 crore every day to the corporation.

There are around 20,500 bus services run by the state government through eight transport corporations, and almost 18,361 were making loss. The corporation contended that the price increase for bulk diesel customers would affect the poor and middle class since they are the major users of the public transport system.

While the Corporation was purchasing diesel at Rs 49.72 per litre before the diesel price hike in January, as a bulk consumer, the price was hiked by Rs 11.81 per litre.

The notice issued to the Ministry and the oil markeging companies is returnable on April 12, 2013.