After Supreme Court snub, KSRTC moves Kerala High Court against bulk diesel price hike

The Kerala State Road Transport Corporation (KSRTC) has filed a plea before the Kerala High Court against increase in prices for bulk diesel sold by state-owned oil marketing companies [Kerala State Road Transport Corporation v Union of India & Ors.]..Last week, the Supreme Court had declined to entertain the plea and granted liberty to the State government to approach the High Court. The Court had also made some stern observations against the Kerala government. Subsequently, the KSRTC approached the High Court with the instant plea..When the plea was mentioned in Court recently, Justice N Nagaresh directed the standing counsel of the Indian Oil Corporation Ltd. to get instructions on the matter. Today, the Court directed the matter to be posted before the appropriate Bench on Tuesday, March 22. .The plea, filed through advocate Deepu Thankan, has challenged the decision of the State-owned Oil Marketing Companies (OMC) to increase the price of High Speed Diesel (HSD) sold in bulk to the KSRTC which is at a higher rate than the market price of diesel. It also pointed out that the KSRTC requires 300-400 KL of HSD per day for operating its daily schedules and has 72 consumer pumps across the state on the basis of separate agreements entered upon with each of the respondent state-owned OMCs. While the KSRTC was initially given a subsidy, it was withdrawn in 2013 and a non-subsidised market-determined price was fixed which was usually less than the price of HSD at retail pumps, the petition stated. However, the price difference between retail and consumer pump prices gradually decreased and by the first week of February 2022, the bulk HSD price reached ₹121.35 from ₹88 which is ₹21 more than the price fixed for retail customers as of March 17, 2022. This has brought forth a situation where private bus operators are availing HSD at lower prices than the government owned KSRTC. "Supply of HSD to the KSRTC alone at a higher price than available in retail outselts for others would amount to discrimination and thus violative of Article 14 of the constitution of India. The increase in the price of HSD to the KSRTC alone will force the, to cancel the schedules to manage the cost of services," the plea said. It was further pointed out that the government had introduced the Petroleum and Natural Gas Regulatory Board Act, 2006 to prevent the exploitation of consumers in the deregulated market. However, even though the Petroleum and Natural Gas Regulatory Board recommended the government to notify all petroleum products to bring those under the purview of the Act, no action has been taken by the Central government in that regard, the petitioner contended. "The continued non-notification fo petroleum, petroleum products and natural gas by the first respondent (Central Govt) deprives Indian consumers of a vital legal protection which is universally considered as a part of the duties and responsibilities of an independent statutory Regulator," the plea said. The petitioner also relied on the decision of the Constitution Bench of the Supreme Court in M/s Sitaram Sugar Co. Ltd. v Union of India to argue that HSD, being a petroleum product under the purview of the Essential Commodities Act, 1955, the High Court is empowered to interfere in the action of the respondents in increasing the prices.Moreover, the unilateral fixation of HSD price by the state-owned OMC is argued to be violative of the Monopolistic and Restrictive Trade Practices Act, 1969.On these, among other grounds, the KSRTC has sought directions from the court to the Central Government and the state-owned OMCs to sell HSD to it at the the market rate available at retail outlets in the State.