The Kerala High Court on Tuesday directed the public sector oil marketing companies (OMCs) to file a statement explaining the manner in which the prices of petrol and diesel are fixed.

Justice N Nagaresh passed the directive on a writ petition by the Kerala State Road Transport Corporation (KSRTC) seeking a directive to the OMCs to sell the high speed diesel (HSD) to KSRTC at a price on par with the rates available at the retail outlets in the State.

When the petition came up for hearing, counsel for the KSRTC sought an interim directive to the companies to sell HSD at the retail outlets price and also a directive not to further enhance the prices. However, the court said it could not issue such a directive.

During the hearing, the court asked why could not the oil companies give some differential treatment to the KSRTC, a public utility service. When the counsel for KSRTC submitted that the corporation was already running under heavy losses and it would be forced to shut down due to the increase in the prices of diesel, the court said the corporation itself had to take the blame for it.

It also pointed out that the transport corporation had sought to be treated as a bulk purchaser, the counsel submitted that it chose the option to purchase diesel in bulk as it was providing a public service and it had separate fuel pumps for its services as otherwise, traffic snarls would have happened at retail outlets.

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Counsel for the KSRTC submitted that the action of the oil companies was unreasonable and irrational. The decision would result in an additional accumulated loss of around ₹83,00,000 per day. It would also force them to cancel the schedules to manage the cost of services and to increase the tariff rates as well..

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