Provide diesel to KSRTC at retail rates: Kerala High Court’s interim direction to oil marketing companies

In an interim order, the Kerala High Court on Wednesday asked the oil marketing companies (OMCs) to provide diesel to the Kerala State Road Transport Corporation (KSRTC) at retail rates and not charge extra for being a bulk purchaser.

The interim order by Justice N Nagaresh was in response to a plea by the the state-owned road transport corporation challenging the OMCs decision to charge a higher rate from bulk purchasers of diesel.

This interim order is provisional and will be subject to the outcome of the writ petition.

The Supreme Court had earlier declined to entertain the plea by KSRTC and granted liberty to the state government to approach the High Court.

KSRTC has, in its petition, mentioned that it is a public sector transport undertaking and requires 300 to 400 kilolitres per day to ply 5,481 buses. The public utility also added in its plea that it was charged Rs 121.35 per litre for diesel by the OMCs, while the retail consumers were getting it for Rs 91.72 per litre.

The respondents, the (OMCs), resisted any interim order contending that the writ petition is not maintainable as the issue involved is within the realm of contract and there is an arbitration clause in the agreement. Subsidy and concession are matters of policy and not in the scope of judicial review, the oil companies said.

The judge in his order also mentioned that prima facie the price levied is highly exorbitant and if it is in pursuance of any agreement, the same prima facie is an extremely unconscionable term of bargain.