PIL Seeks CBI Probe Into Illegal Sale Of Petroleum Products; AP High Court Halts Establishment Of Proposed 11 Petroleum Outlets

The Andhra Pradesh High Court has directed various Petroleum Corporations not to finalise the establishment of 11 proposed petroleum outlets in Puducherry's Yanam in a PIL filed seeking a CBI investigation into the alleged illegal sale of petrol and diesel across the borders of AP and Yanam.

The Division Bench of Justice A.V. Sesha Sai and Justice T. Mallikarjuna Rao passed the interim order in reference to a notification issued by Indian Oil Petroleum Corporation Ltd, Bharat Petroleum Corporation Ltd and Hindustan Petroleum Corporation Ltd proposing to establish 11 new petroleum outlets in Yanam.

"Having regard to the submissions of the learned Senior Counsel for the petitioner and taking into consideration, the averments made in the affidavit filed in support of the Writ Petition, there shall be a direction to the Respondent Petroleum Corporations not to finalize establishment of Petroleum Outlets pursuant to the impugned notification, dated 28.06.2023, pending further orders. However, other proceedings may go on."

Yanam is a Union Territory of the State of Pondicherry, which is surrounded by the State of Andhra Pradesh on all four sides. The districts of AP that surround Yanam have several industries that require thousands of kilo-litres of petroleum every day.

The contentions of the petitioner are that petrol and diesel are being purchased by corporations in Yanam from the bulk sale points within the State Of Andhra Pradesh and instead of being transported to Yanam, it is sold in surrounding districts of AP, at the cost prevalent in the Union Territory, causing a massive loss the revenue of the State and Public Exchequer.

"As on today, one liter of Petrol in Retail Outlet/Yanam costs Rs.96.82 whereas in Andhra Pradesh, the rate is Rs.112.22 and the difference is Rs.15.40 Ps. The Diesel is sold for Rs. 86.59 inYanam and in Andhra Pradesh, rate is Rs.99.88 and the difference is Rs.13.29 Ps. This is due to the fact that there is VAT and other components imposed in Andhra Pradesh in high whereas in Union Territory of Puducherry (Yanam is a part of Puducherry), the taxes are lower, being Union Territory," the petitioner explained.

The petitioner further stated that the modus operandi is twofold. One as explained above, and a second wherein tankers from the State of Andhra unload their products in filling stations of Yanam, who in turn sold the product as their own.

It was stated that approximately 5,50,000 litres of petroleum were being sold in Yanam in a single day, which was impossible with a population of only 69,375. Adding to that a report from an Investigation Officer showed that 1972 litres of petrol was sold in 3 minutes by a single station.

It was emphasized that such illegal sale has been going on at least since 2018 when the Regional Coordinator for Sale of Petroleum had raised the issue.

FIRs were filed along with the petition that were registered subsequent to the seizures of Petroleum tankers, within AP containing petroleum meant for retail in Yanam. It was contended that the Union Territory had an unexplained high sale of petroleum, which was impossible owing to its limited population.

The respondent Government officials were condemned for turning a blind eye to such illegal sale, and in fact, considering the proposition of establishing 11 new petrol bunks within the U.T. adding to the already existing 10.

While passing the order, the Bench took into consideration a letter addressed by the State Level Coordinate far back in 2018, voicing concern over the issue. Thus, the petitioner was asked to take out personal notice, and official respondents present in the court were asked to file counters within a period of 4 weeks.

Case Title: A. Bhima Naga Ramesh v. UoI

Counsel for petitioner: K.S.Murthy, Senior Counsel, representing Ponnada Sree

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