New Delhi, Jan 2 IANS | 7 months ago

The Delhi High Court Thursday issued notice to the central and Delhi governments on a petition filed by Delhi Contract Bus Association challenging the recent steep Rs. 4.50 a kg hike in CNG price.


Justice Manmohan sought response from the petroleum ministry and the Delhi government through Indraprastha Gas Limited (IGL) by Feb 18 on the association's plea for direction not to reduce the allocation and supply of domestic gas to the city.

Following a Gujarat High Court order in December, the government has ordered all of domestically available compressed natural gas (CNG) for city gas projects to be equitably distributed among all the companies in the country. Prior to this, cheaper domestic gas was largely available to firms retailing CNG in Delhi and Mumbai.

Indraprastha Gas Limited (IGL), which is the sole retailer of CNG in the national capital, hiked the CNG price on Dec 26 by Rs.4.50 per kg, saying the rate increase was forced by court orders that led to cut in allocation of cheaper domestic natural gas.

The Delhi government in its submissions told the court that any reduction in allocation of CNG to the city would adversely impact prices of essential commodities as well as discourage the use of the clean fuel CNG.

It argued that hike in CNG price is against the Supreme Court's ruling, which had issued direction to convert the fleets of buses to CNG.

The Gujarat High Court Dec 25 last year ordered cutting the allocation of gas supply and IGL implemented the changes in rates the next day.

In its petition, the transport association said: "Supply/allocation would have a substantial impact upon the petitioner, as such reduction would mean that IGL would have to make shortfall from imported natural gas at a much higher price. The same would also be contrary to the Supreme Court order."

"Supply of domestic gas to IGL would be reduced from 2.344 MMSCMD to 2.228 MMSCMD, which amounts to almost a 5 percent reduction and translates to a reduction of supply of 1,16,000 standard cubic meters per day," the petition added.

The court, meanwhile, also refused to suspend the IGL's decision to hike the CNG price.

The city counsel told the court that the Supreme Court had asked the central government to give priority to transport sector, including private vehicles, all over India with regard to the allocation of CNG.

"This means that first the transport sector in Delhi, and in the other air polluted cities of India, CNG will be allocated and made available and it is only thereafter if any CNG is available, that the same can be allocated to the industries, preference being shown to public sector undertaking and power projects," argued city government's counsel.

"After use of CNG by the vehicles running in Delhi, there is considerable reduction in the pollution level into the pollution level figures of 1996," counsel added.

The Delhi government also supported the arguments of petitioner and said: "It is a hard fact that there would be an increase in the CNG prices as well as a result of the reduction of allocation of domestic gas in accordance with guidelines of Nov 14, 2013, issued by ministry, and an adverse economic impact on the commercial vehicles operators who got converted their vehicles to CNG by investing additional money on it."

It added that any reduction in allocation of CNG to Delhi would not only increase price of CNG alone but would have further impact on rising of prices of essential commodities as well as "discourage the use of CNG".

(Posted on 02-01-2014)