Orders are reserved on the writ appeal of the Union Petroleum Ministry to set aside an order dated March 14 last of a single judge, which restrained the ministry and oil companies from charging a higher price for diesel for State Transport Corporations in the Staste than the price charged for private retail customers.
The First Bench comprising Acting Chief Justice R K Agrawal and Justice N Paul Vasanthakumar reserved orders after hearing the arguments of Advocate-General A L Somayaji, Additional Solicitor-General P Wilson and oil companies senior counsel M Ravindran, on Monday.
The Bench had earlier asked the State government whether it was prepared to furnish bank guarantee for the differential amount to oil companies if the fuel was supplied to State Transport Corporations at the depots and if the government loses the case before the court.
The AG submitted that the appellant was prepared to file an undertaking. However, Wilson and Ravindran said the Centre and oil companies were not prepared to accept it. Ravindran said that there were 1,500 bulk consumers in Tamil Nadu. Of these, 1,100 were supplied by Indian Oil Corporation alone. Following the interim order in favour of the STCs, if other bulk consumers also were to approach the court for similar relief, the loss to the oil companies would be around `400 crore per day. It was proposed to withdraw subsidy on diesel being given to private retail consumers in a few months. Then the price would become equal.
Wilson said granting injunction against a policy decision was not automatic. On several occasions, the Supreme Court had said that only in irreparable cases, injunction could be granted. In the present case, the single judge had granted an injunction at the inception stage. The single judge’s order was untenable, he argued.