High Court asks ONGC to pay Rs.11,000 crore to Gujarat government
December 01, 2013
Ahmedabad, 1 December, 2013
The Gujarat High Court on Saturday asked ONGC to pay Rs. 11,000 crore royalty to Gujarat government in 60 days.
As per the Oil field act 1998, ONGC had to pay 20% amount of fair market price to state government for crude oil. However in year 2004, the central government ammended the policy and started supplying crude to state on subsidized rate through public sector unit BP, HP and IOC. With this amendment, the amount of royalty went down as much as 90 to 95%.
The government of Gujarat had in its plea opposed ONGC’s year 2004 notification declaring new policy on paying royalty of crude oil to state.
A bench of Chief Justice of Gujarat Bhaskar Bhattacharya and Justice J.B.Pardiwala declared year 2004 notification invalid and asked ONGC to pay balance amount to Gujarat government in two months period.
The amount suitable to be paid to Gujarat government is as high as 11,000 crore.
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