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High profile oil & gas sector gets no mention in Union Budget

This happened against the backdrop of certain inputs by the Petroleum Ministry being found among the stacks of stolen documents

Press Trust of India  |  New Delhi 

Arun Jaitley

Barring duty rejig for petrol and diesel, Finance Minister Arun Jaitley did not mention the high profile oil and gas sector in his speech yesterday.

This happened against the backdrop of certain inputs by the Petroleum Ministry being found among the stacks of stolen documents..

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Jaitley, presenting the for 2015-16 yesterday in the Lok Sabha, did not mention of any initiative in the oil and gas sector other than an excise duty rejig on petrol and diesel to make available Rs 40,000 crore for roads and highway construction.

A dozen persons were arrested last month for allegedly stealing official documents from the coal, power and oil ministries. The stacks of stolen documents recovered included details of exploration sites, natural gas pricing and the Oil Ministry's arbitration with Reliance Industries Ltd.

Among these were inputs given by the ministry to be included in the speech.

"Photocopy of documents with heading input material on National Gas Grid for inclusion in Finance Minister's budget speech 2015-16," the FIR mentions on the list of recovered documents.

Among those held are officials from RIL, Essar Oil, Cairn India, Jubilant and Reliance Group.

Jaitley said in the Budget speech that existing excise duty on petrol and diesel is being converted "to the extent of Rs 4 per litre into Road Cess to fund investment in roads and other infrastructure. An additional sum of Rs 40,000 crore will be made available through this measure for these sectors".

Petrol attracts a total excise duty of Rs 17.46 per litre, including Rs 2 a litre road cess. Similarly, diesel attracts Rs 10.26 a litre total excise duty, including Rs 2 per litre road cess.

The duty incidence on petrol is made up of Rs 8.95 per litre basic central excise or CENVAT, Rs 6 per litre special excise duty, Rs 2 per litre road cess and 3% education cess.

This has now been changed to Rs 5.46 a litre CENVAT, Rs 6 per litre special excise and Rs 6 road cess. Education cesses have been subsumed in the final duty.

On diesel, there is a CENVAT of Rs 7.96 a litre plus Rs 2 road cess and 3% education cesses. This will now change to Rs 4.26 a litre CENVAT and Rs 6 a litre road cess.

The total incidence of various duties of excise on petrol and diesel remains unchanged.

Also, specific rates are being revised only to the extent of subsuming the quantum of education cess presently levied on them, keeping the total incidence of excise duties unchanged, he said.

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First Published: Sun, March 01 2015. 16:57 IST