BHUBANESWAR: The scheduled meeting between Chief Minister Naveen Patnaik and Union Minister of State for Petroleum and Natural Gas Dharmendra Pradhan at New Delhi on Friday has not only fuelled speculation over its political implications in Odisha, but also given rise to expectations of a solution to the tax dispute between the State Government and Indian Oil Corporation Limited (IOCL) over the Paradip refinery.
The meeting scheduled at 11 am in Odisha Bhavan between the two leaders has generated political heat in the State even as the BJD and BJP have launched an all out fight against each other in the State keeping an eye on next Assembly elections.The meeting has come in for criticism from Agriculture Minister Damodar Rout who said the Chief Minister should have called the Union Minister to Bhubaneswar for a discussion. “Naveen Patnaik is the Chief Minister and he (Pradhan) is a Minister of State. There is protocol,” Rout said.
Sources, however, maintained that it was Pradhan who had taken the initiative for a meeting and the Chief Minister responded positively. There has been several meetings between the Odisha Government team headed by Chief Secretary AP Padhi and officials of the Ministry of Petroleum without any result so far.
The State Government and IOCL had signed a Memorandum of Understanding (MoU) on February 16, 2004 for setting up an oil refinery at Paradip. One of the conditions in the MoU was the deferred VAT payment for 11 years on sale of products of Paradip oil refinery.
Paradip Oil Refinery, which started its production from September 22, 2015, had collected VAT amounting to `1,485 crore by selling its products in Odisha till December, 2016. The State Government had issued a demand note of `1,485 crore to IOCL on February 27 and directed to repay the same after serving a notice.
The IOCL had challenged State Government order in the Orissa High Court. A division bench of the High Court on March 16, 2017, had kept the demand notice of the State Government in abeyance and directed the working group comprising officials from the State Government, Petroleum Ministry and IOCL to resolve the issue.