Kerala High Court declines to grant interim relief to KSRTC in plea against bulk diesel price hike

The Kerala High Court on Tuesday declined to grant any interim relief to the Kerala State Road Transport Corporation (KSRTC) in a petition moved by it against increase in prices of bulk diesel sold by State-owned oil marketing companies [Kerala State Road Transport Corporation v Union of India & Ors.]..Justice N Nagaresh opined that the case was not a fit one for grant of any reliefs until the oil marketing companies (OMCs) file a statement explaining the present pricing mechanism."I understand your difficulty but this is not a case for interim order," the judge orally observed. However, the Court opined that the OMCs concerned should consider showing some leniency to the public sector undertakings like the KSRTC. "There should be some difference between public utility services and private and commercial enterprise consumers," Justice Nagaresh orally remarked. "The respondent corporation is directed to file a statement explaining the manner in which the pricing mechanism is working," the Court ordered.Advocate Deepu Thankan, representing KSRTC, argued that the price hike is devoid of logic and is the result of nothing but a marketing strategy adopted by the OMCs. He pressed for an interim stay and said that if the same was not granted, the KSRTC would be forced to shut down its operations as it would not be able to withstand for much longer, the substantial losses it is already suffering. When the Court declined to do so, Thankan requested that a direction be issued that the present price may not be increased until next posting day.The Court, however, pointed out that the same is not within its jurisdiction under Article 226 of the Constitution of India and posted the matter for further consideration on April 4. .The plea, filed through advocate Deepu Thankan, has challenged the decision of the OMCs 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 was 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entered upon with each of the respondent state-owned OMCs.While the KSRTC was initially given a subsidy, it was withdrawn in 2013 and a non-subsidised market-determined price was fixed which was usually less than the price of HSD at retail pumps, the petition stated.However, it was pointed out that 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."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..On these, among other grounds, the KSRTC 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..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.The matter will be taken up next on April 4 by which time the respondents are expected to file their statement regarding the present pricing mechanism.