Essar Oil pays Rs. 736.75 cr outstanding VAT in fourth installment

Ahmedabad, 22 November 2013

Essar Oil Ltd(EOL) has in its fourth installment paid Rs. 736.75 crore outstanding value-added tax (VAT) including Rs. 92 crores as interest to Gujarat government. The Supreme Court had directed EOL to pay outstanding VAT in eight installment. EOL has yet to pay four more installments.

EOL had earlier paid a total of Rs 3,695 crore as VAT. Of this, Rs 2,691.59 crore was paid in three installments after the apex court’s directive. The government was yet to recover Rs 3,474.4 crore from EOL. Now Rs. 736 crore are paid in fourth installment.

Recovery of commercial tax was also pending against EOL in two cases–one for Rs 0.23 crore (2007-08) and the other was for Rs 641.19 crore (2008-09). In both cases the Commercial Tax Tribunal has stayed recovery till pendency of the matter.

In last October, state Finance minister Nitin Patel, in a written reply to the assembly, said Rs 4,206.5 crore in the form of commercial tax was yet to be recovered from four companies of Essar group operating in the state. These companies are EOL (Jamnagar), Essar Project (India) Ltd (Ahmedabad), Essar Steel (Surat) and Essar Project (Jamnagar). According to Patel, Rs 2.56 crore was to be recovered from Essar Project (India), Ahmedabad, Rs 1.6 crore from Essar Project, Jamnagar and Rs 86.54 crore from Essar Steel, Surat. In all these cases, the competent authority has imposed a stay on recovery till pendency of the cases.