Grappling a shortfall in tax revenues, the government has pressed cash-rich PSUs like Indian Oil Corp (IOC) and Oil and Natural Gas Corp (ONGC) to pay a second interim dividend for the current fiscal after seeking regulatory nods.
While IOC has called a board meeting on March 19 to consider paying a second interim dividend, ONGC has declined saying it does not have surplus cash to make such payments within a month of an interim dividend payout, sources with direct knowledge of the development said.
As per regulations, a company cannot declare a second dividend within a month of the previous payout and companies like ONGC would need to seek an approval of the market regulator SEBI to make such a payment.
Sources said the government is struggling to meet the revised fiscal deficit target of 3.4 per cent in view of shortfall in Goods and Services Tax (GST) collections.
GST shortfall is likely to be around Rs 30,000-40,000 crore and a similar shortfall is expected in direct tax collections as well, they said.
In a regulatory filing, IOC said: "A board meeting of the company is scheduled on Tuesday, March 19, 2019...to consider declaration of 2nd interim dividend for the financial year 2018-19."
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