Published On:
Posted by Levasto India
SC directs Essar to pay Rs 1,000-cr sales tax dues to Guj Govt
New Delhi: The Supreme Court on Tuesday asked Essar Oil to pay up by July 30 to avoid any coercive action.
Though the company also sought waiver of the interest, the Court said other issues (such as interest and a tax repayment schedule) will be considered only when the matter is taken up again on July 31. Essar said that it is in advanced discussions with Indian lenders for putting in place a $1 billion (Rs 5,500 crore approximately) loan facility.
This will be a contingency measure for use if the tax liability becomes payable immediately or if Essar Oil is not able to negotiate a satisfactory repayment schedule, it said. "We expect this facility to be finalised shortly," it added.The apex court had in January set aside Gujarat High Court order that had permitted Essar to avail the Sales Tax Deferment Scheme (to pay Sales Tax in deferred installments).
Essar had filed a petition to review this apex court order, which was also dismissed in April.
Essar Oil had claimed benefits for its Vadinar Refinery project. The company was eligible for Rs 9,100 crore (125 per cent of eligible capital investment) as sales tax incentive under the Scheme.
According to the Scheme, Essar was liable to complete the refinery project by August 15, 2003, to be eligible to claim this benefit. However, the Company could complete the project only in 2006 and started commercial production in 2008.