Govt clarifies on resumption of fertiliser subsidy to GSFC

Our Bureau New Delhi | Updated on January 09, 2018 Published on November 11, 2017


The government on Saturday denied any inconsistency in its decision to resume fertiliser subsidy to Gujarat State Fertiliser Corporation (GSFC), as alleged by some reports.

Issuing a clarification, the Ministry of Chemicals and fertilisers said “the subsidy on ammonium sulphate (AS) of GSFC was stopped by an order dated 18.03.2013 on the grounds that the company had not passed on the benefits of subsidy to the farmers. The recovery of subsidy already paid to GSFC on AS w.e.f. 01.04.10 was also ordered by the same order. The order was issued as the company failed to provide the requisite data to substantiate its claim that it has passed on the benefits of subsidy to the farmers.”

It said the GSFC filed a writ petition before the Delhi High Court against the order immediately, after which the court asked GSFC to make a representation to the Department of Fertilisers for reconsideration of the matter along with all the requisite documents/data.

The Court further ordered the department to dispose of the representation within four weeks, said an official statement, adding that accordingly, GSFC made a representation along with the requisite data.

“The data was forwarded to the Fertilizers Industry Coordination Committee (FICC), a subordinate office of the department. After the examination, FICC found that the company has not fully passed on the benefits during 2010-11 and made undue profits. However, the company had passed on the benefits to the farmers during 2011-12 and 2012-13, it said.

FICC calculated the amount of Rs 33.78 crore to be recovered from GSFC for not passing on the benefits of subsidy to the farmers during 2010-11.

Following this, a committee of senior officers of the department was constituted to examine the analysis done by FICC, which eventually “accepted the analysis done by FICC and recommended that the amount of Rs 33.78 crores may be recovered from the withheld subsidy amount of the company w.e.f. 01.04.10 to 17.03.13. The committee further recommended to induct the AS with effect from the approval of the Competent Authority i.e 06.03.2017.”

The government said that since the matter was sub judice and the court had given a stay on the order to the extent it seeks recovery of past dues, the department informed the company that the department cannot take further action. “The company withdrew the case to enable the department to make recovery and take further action,” the statement said.

The Ministry said the matter of release of subsidy for the period 18.03.13 to 05.03.17 “was still under examination and no subsidy had been released to the company for the above period yet”, adding that in view of the above facts, the department had released the subsidy in line with the orders of Court and in view of the benefit of the farmers.

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Published on November 11, 2017
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