No communication from government on sacrificing its share of Value Added Tax, say oil companies

Confusion over pricing and protest in some localities brought cooking gas distribution to a halt in several parts of the district for the second day on Thursday.

Gas distribution was affected on Wednesday following confusion arising out of Chief Minister Oommen Chandy’s statement that the Union government had denied any hike in LPG price. Though the air was cleared on the price front by Thursday morning, Mr. Chandy’s promise that the State would forgo its share of Value Added Tax on the increased price of LPG had held up billing for new stocks.

“Only when the price of LPG is notified by the oil marketing companies do retailers make their intents,” said an LPG distributor in the city though he pointed out that his outlet worked full time on Thursday with the stock that was available.

Meanwhile, retailers in Perumbavoor said protest by a political party had disrupted sales on Thursday. The party workers laid siege to two retail outlets in the town, forcing them to close shop without distributing any cylinders.

Retailers received no fresh supplies on Thursday from bottling plants in Kochi, the largest of which is operated by the Indian Oil Corporation (IOC). Bottling operations were suspended on Thursday as lorries, already loaded with full cylinders on Wednesday, did not leave the plant premises because they had not been billed yet.

Sources said that more than 50 lorries laden with full cylinders and billed for supplies at the non-subsidised rate were idling at the plant and no new lorries came in during the day. Since the deadline for linking bank accounts with LPG distributors using the Aadhaar cards ended on December 31, the oil companies had billed the fresh supplies at the non-subsidised rates, sources added.

However, with the deadline for bank linkage being extended for another two months there is some confusion on the price tag for subsidised domestic cylinders, which weighs 14.2 kg apiece.

But sources said the three public sector oil marketing companies had not received any instructions from the State Government on VAT for LPG on Thursday. Only with a government order on VAT on LPG can oil marketing companies and the distributors finalise their fresh bills.

Sources said that between 65 and 70 per cent of the LPG users in the State, numbering a total of 78 lakh, had linked their bank accounts using Aadhaar for receiving direct subsidy payment.

IOC accounts for 41 lakh of the total customers. Company sources said 68 per cent of its customers had already linked their bank accounts for receiving the subsidy payment.

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