The Madras High Court on Thursday restrained the petroleum ministry and oil companies from charging State Transport Undertakings (STUs) a higher price for diesel.

The Court granted an interim injunction till April 12 in this regard.

This means, transport corporation buses in Tamil Nadu need not queue up at retail fuel outlets, at least for a month. Passengers will be spared the long wait while the buses tank up.

Justice S. Rajeswaran passed the interim order on a writ petition filed by the Tamil Nadu Government, represented by principal secretary, transport, Braj Kishore Prasad, who is also the chairman of the STUs.

The Judge ordered notice to Hindustan Petroleum, Bharat Petroleum and Indian Oil Corporation, returnable by April 12.

The petitioner said buses of Tamil Nadu STUs ferried nearly two crore passengers every day. The STUs continued to operate on several loss-making bus routes in order to provide transport to people in remote villages.

In 2011-12, the STUs incurred a loss of Rs. 1,791 crore along with a cash loss of Rs. 1,392 crore. Even though the price of diesel was increased from time to time, the STUs continued to offer services at affordable rates leading to accumulated losses, the petition said.

Nearly 35 per cent of the total loss was owing to increasing cost of fuel, it said.

The transport secretary said that prior to January 18, 2013, diesel was sold at Rs. 49.72 per litre to STUs whereas for private retail customers, it was priced at Rs. 50.72. STUs consumed 12.75 lakh litres of diesel every day and the total cost incurred on fuel was Rs. 8.57 crore.

After the implementation of dual-pricing policy from January 18, the concession to STUs was withdrawn. Treating them as bulk purchasers, the government imposed a higher cost on them. The policy was discriminatory, the secretary said.

As the price of diesel for bulk consumers went up by Rs. 11.81 per litre, STUs would incur additional expenses of about Rs. 743 crore per year, he said.

The dual-pricing policy, treating Tamil Nadu’s STUs as bulk consumers, was arbitrary, unreasonable and unfair. It put the State transport corporations at an extremely disadvantageous position vis-à-vis private operators, the petitioner said.

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