Lok Sabha Question No. 109 (UNSTARRED), answered on 2016-04-25
Subject: Black Marketing of Kerosene Oil
Ministry: PETROLEUM AND NATURAL GAS
Asked by: MUKESH RAJPUT, RAJENDRA AGRAWAL, KANWAR SINGH TANWAR

## UNSTARRED QUESTION NO.109 TO BE ANSWERED ON 25 TH   APRIL, 2016

## BLACK MARKETING OF KEROSENE OIL

- †109.  SHRI MUKESH RAJPUT : SHRI RAJENDRA AGRAWAL : SHRI KANWAR SINGH TANWAR :

## पैट्रोलियम और प्राक ृ लिक गैस मंत्री

Will the Minister of PETROLEUM & NATURAL GAS be pleased to state:

(a)   whether the instances of Oil Marketing Companies (OMCs) not following/complying with  'in  house  marker  system'  regarding  doping  of  kerosene  oil  distributed  under  Public Distribution System (PDS) have been reported/noticed by the Government during each of the last three years, State/OMC/UT-wise;

(b)  if so, the details thereof and the action taken by the Government thereon, State/UTwise and OMC-wise;

(c)  whether the Government proposes to reduce the subsidy on kerosene in the backdrop of black marketing of kerosene and if so, the details thereof along with quantum of subsidy given by the Government during the said period, State/OMC/UT-wise;

(d)  the details of guidelines issued/laid down for allotment of PDS Kerosene Oil dealership by the OMCs;

(e)  whether any complaints of alleged irregularities against PDS SKO dealers have been received by the  Government and if so, the details thereof and action taken in this regard during the said period along with the monitoring mechanism put in place to monitor PDS SKO dealers in the country, State/OMC/UT-wise; and

(f)   whether the Government has noted any reduction of kerosene consumption due to use of clean/renewable energy during the said period and if so, the details thereof?

## A N S W E R

पैट्रोलियम और प्राक ृ लिक गैस मंत्रािय में राज् य मंत्री ( स् विंत्र प्राार )  ( री ेमध श्र प्रेान )

## MINISTER OF STATE (INDEPENDENT CHARGE) IN THE MINISTRY OF PETROLEUM & NATURAL GAS (SHRI DHARMENDRA PRADHAN)

(a)& (b) :  At present, there is no such scheme in vogue for doping of in house marker in kerosene  oil  distributed  under  Public  Distribution  System  (PDS)  by  Public  Sector  Oil Marketing Companies (OMCs).

(c)    :        With  a  view  to  reach  the  PDS  kerosene  to  the  targeted  beneficiaries,  the Government  has  announced  implementation  of  Direct  Benefit  Transfer    in  Kerosene (DBTK)  during  financial  year  2016-17  in  33  districts  identified  by  9  State  Governments namely, Chhattisgarh, Haryana, Himachal Pradesh, Jharkhand, Madhya Pradesh, Maharashtra, Punjab, Rajasthan and Gujarat.

Under  the  scheme  for  direct  transfer  of  subsidy,  the  consumer  will  pay  the  nonsubsidized price of kerosene at the time of purchase. Subsequently, the amount of subsidy will be  directly transferred to  the  bank  account  of  the  beneficiary.  To  avoid  any inconvenience  to  the  beneficiary  during  the  initial  purchase  through  payment  of  nonsubsidized price, an initial amount of subsidy shall be credited to all eligible beneficiaries. As a part of this scheme, implementing States will be given fiscal incentives equivalent to 75 % of subsidy saved in the first two years, 50 % of subsidy saved  in third year and 25 % of  subsidy  saved  in  4 th year.    OMC-wise  details  of  subsidy/under  recovery  on  PDS Kerosene is given below :

Rs. in Crores

| OMC Name                                      | 2012-13   | 2013-14   | 2014-15   | 9 Months, 2015-16   |
|-----------------------------------------------|-----------|-----------|-----------|---------------------|
| Indian Oil Corporation Ltd. (IOCL)            | 20,007    | 20,903    | 16,635    | 6,727               |
| Hindustan Petroleum Corporation Ltd. (HPCL)   | 5,360     | 5,440     | 4,293     | 1,703               |
| Bharat Petroleum Corporation Ltd. (BPCL)      | 4,788     | 4,912     | 3,876     | 1,562               |
| Total Subsidy /under recovery on PDS Kerosene | 30,156    | 31,255    | 24,804    | 9,993               |

(d)    :    Details  of  guidelines  for  allotment  of  PDS  Kerosene  wholesaler  is  given  at Annexure-I .

(e)  : In order to check the pilferage of PDS kerosene, the Central Government have made provisions in the Kerosene (Restriction on Use and Fixation of Ceiling Price) Order, 1993, issued under the Essential Commodities Act, 1955, as  per  which  dealers  have  to  sell PDS  Kerosene  at  a  price  fixed  by  the Government or OMCs and have to prominently display stock-cum-price board at the place of business including  the  place  of  store  at  a

Contd……3/-

conspicuous  place.    Further,  PDS  kerosene  released  is  dyed  with  blue  dye  to  facilitate detection of PDS  kerosene in non-PDS uses. Under this Control Order, State Governments  are  also  empowered  to  take  action  against  those  indulging  in  blackmarketing and other irregularities.

Field Officers of OMCs  inspect the Kerosene Dealerships and check for irregularities like non-observance  of Government/OMCs  regulations,  over charging, unauthorized purchase and stock variation.   In case of any irregularities, action is taken as per the Marketing Discipline Guidelines (MDG).

OMCs have hosted a web portal which enables public access to the movement of PDS Kerosene tank trucks.  It provides details of the tank truck movement carrying PDS Kerosene from their Dispatch Units/Depots/ Installations to the various dealers along with their names, invoice number, quantity of product, time of dispatch, tank truck number, etc. on the websites on real time basis.  The  State--wise details of irregularities detected and action  taken  thereon  for  last  three  year  and  current  year  (April-June,  2015)    is  at Annexure-II.

(f)  :  With the expansion of LPG /PNG coverage in the country, the use of kerosene for cooking purpose reduces.  Quota of PDS kerosene in respect of States/UTs is rationalized based on various factors like  increase  in  Domestic  LPG/PNG  connections,  non-lifting  of PDS kerosene quota by the concerned States/UTs, cap on the per capita PDS kerosene allocation for non-LPG and non-PNG population. Allocation of PDS Kerosene made to the States during the last three years  is as under:

| Year    |   Allocation in KL |
|---------|--------------------|
| 2013-14 |            9086858 |
| 2014-15 |            8975538 |
| 2015-16 |            8685384 |

*************

## Annexure - I

Annexure referred to in reply to part (d) of Lok Sabha Unstarred Question No.109 asked by Shri Mukesh Rajput and others for answer on 25.04.2016 regarding 'Black Marketing of Kerosene Oil'.

Post dismantling of Administrative Price Mechanism  (APM),  the  Ministry of Petroleum and Natural Gas advised Oil industry in August 2002 to develop and implement its own marketing plan, following the prescribed reservation.   Accordingly, marketing plan was  finalized  on  100  point  roster  basis  for  meeting  the  requirement  of  reservation,  as prescribed for all the social categories for all the states as applicable. The salient features of the said dealers selection policy are as under:

Eligibility  criteria:  Indian  national,  Age:  minimum  21  years  &  above,  Education: minimum Matriculation.

The percentage reservation, state wise, for various categories is as under:

| Details of category                 | Category code   | Reservation%   |
|-------------------------------------|-----------------|----------------|
| Scheduled castes/ Scheduled tribes* | SC/ST           | 25%            |
| Physically handicapped persons      | PH              | 5%             |
| paramilitary/police/govt. personnel | PMP             | 8%             |
| Defence personnel                   | DC              | 8%             |
| Freedom fighters                    | FF              | 2%             |
| Outstanding sports persons          | OSP             | 2%             |
| Open                                | OP              | 50%            |

For North-eastern states reservation is as follows:

| State             |   Percentage dealerships to ST category |   Balance % to open category |
|-------------------|-----------------------------------------|------------------------------|
| Arunachal Pradesh |                                      70 |                           30 |
| Meghalaya         |                                      80 |                           20 |
| Nagaland          |                                      80 |                           20 |
| Mizoram           |                                      90 |                           10 |

-  33%  of  the  locations  to  be  reserved  for  women  belonging  to  each  of  the respective categories
-  only one dealership will be allowed to a family unit
-  in case of partnerships, all partners should individually fulfil eligibility criteria
-  if  employed candidate will be required to leave the job prior to appointment as dealer
-  Disqualified if convicted by law for criminal offence involving moral turpitude/economic  offences,  mentally  unsound,  totally  paralyzed  or  totally blind and guilty of willfully giving wrong information
-  No income ceiling
-  Corpus Fund Scheme to continue in its existing form

After  advertisement,  receipt  and  scrutiny  of  applications,  interview  by  a  selection committee on the basis of the following evaluation criteria:

| Parameter                                                |   Max. marks |
|----------------------------------------------------------|--------------|
| Capability to provide land and infrastructure/facilities |           35 |
| Capability to provide finance                            |           25 |
| Educational qualifications                               |           15 |
| Capability to generate business                          |           10 |
| Age                                                      |           04 |
| Experience                                               |           04 |
| Business ability/acumen                                  |           05 |
| Personality                                              |           02 |
| Total Marks                                              |          100 |

*********

| ANNEXURE-II Annexure referred to in reply to part (e) of Lok Sabha Untarred Question No.109 for answer on 25.04.2016 asked by Shri Mukesh Rajput and others regarding black marketing of Kerosene Oil.   | ANNEXURE-II Annexure referred to in reply to part (e) of Lok Sabha Untarred Question No.109 for answer on 25.04.2016 asked by Shri Mukesh Rajput and others regarding black marketing of Kerosene Oil.   | ANNEXURE-II Annexure referred to in reply to part (e) of Lok Sabha Untarred Question No.109 for answer on 25.04.2016 asked by Shri Mukesh Rajput and others regarding black marketing of Kerosene Oil.   | ANNEXURE-II Annexure referred to in reply to part (e) of Lok Sabha Untarred Question No.109 for answer on 25.04.2016 asked by Shri Mukesh Rajput and others regarding black marketing of Kerosene Oil.   | ANNEXURE-II Annexure referred to in reply to part (e) of Lok Sabha Untarred Question No.109 for answer on 25.04.2016 asked by Shri Mukesh Rajput and others regarding black marketing of Kerosene Oil.   | ANNEXURE-II Annexure referred to in reply to part (e) of Lok Sabha Untarred Question No.109 for answer on 25.04.2016 asked by Shri Mukesh Rajput and others regarding black marketing of Kerosene Oil.   | ANNEXURE-II Annexure referred to in reply to part (e) of Lok Sabha Untarred Question No.109 for answer on 25.04.2016 asked by Shri Mukesh Rajput and others regarding black marketing of Kerosene Oil.   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| State and OMC-wise details of action taken against the Kerosene dealers on account of the cases of black-marketing, diversion and other malpractices during the last three years.                        | State and OMC-wise details of action taken against the Kerosene dealers on account of the cases of black-marketing, diversion and other malpractices during the last three years.                        | State and OMC-wise details of action taken against the Kerosene dealers on account of the cases of black-marketing, diversion and other malpractices during the last three years.                        | State and OMC-wise details of action taken against the Kerosene dealers on account of the cases of black-marketing, diversion and other malpractices during the last three years.                        | State and OMC-wise details of action taken against the Kerosene dealers on account of the cases of black-marketing, diversion and other malpractices during the last three years.                        | State and OMC-wise details of action taken against the Kerosene dealers on account of the cases of black-marketing, diversion and other malpractices during the last three years.                        | State and OMC-wise details of action taken against the Kerosene dealers on account of the cases of black-marketing, diversion and other malpractices during the last three years.                        |
|                                                                                                                                                                                                          | State                                                                                                                                                                                                    | Terminated                                                                                                                                                                                               | Suspended                                                                                                                                                                                                | Subjudice                                                                                                                                                                                                | Supply resumed                                                                                                                                                                                           | No. of cases of malpractices / irregularities came to the notice                                                                                                                                         |
| Indian Oil Corporation Limited (IOCL):                                                                                                                                                                   | Indian Oil Corporation Limited (IOCL):                                                                                                                                                                   | Indian Oil Corporation Limited (IOCL):                                                                                                                                                                   | Indian Oil Corporation Limited (IOCL):                                                                                                                                                                   | Indian Oil Corporation Limited (IOCL):                                                                                                                                                                   | Indian Oil Corporation Limited (IOCL):                                                                                                                                                                   | Indian Oil Corporation Limited (IOCL):                                                                                                                                                                   |
|                                                                                                                                                                                                          | Andhra Pradesh                                                                                                                                                                                           | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | Assam                                                                                                                                                                                                    | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        | 2                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | Bihar                                                                                                                                                                                                    | 0                                                                                                                                                                                                        | 2                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        | 3                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | Gujarat                                                                                                                                                                                                  | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        | 1                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | Haryana                                                                                                                                                                                                  | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | Jharkhand                                                                                                                                                                                                | 0                                                                                                                                                                                                        | 3                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 3                                                                                                                                                                                                        | 6                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | Karnataka                                                                                                                                                                                                | 0                                                                                                                                                                                                        | 6                                                                                                                                                                                                        | 1                                                                                                                                                                                                        | 4                                                                                                                                                                                                        | 11                                                                                                                                                                                                       |
|                                                                                                                                                                                                          | Kerala                                                                                                                                                                                                   | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | Madhya Pradesh                                                                                                                                                                                           | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        | 1                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | Maharasthra                                                                                                                                                                                              | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | Odisha                                                                                                                                                                                                   | 0                                                                                                                                                                                                        | 2                                                                                                                                                                                                        | 3                                                                                                                                                                                                        | 3                                                                                                                                                                                                        | 8                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | Punjab                                                                                                                                                                                                   | 2                                                                                                                                                                                                        | 1                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 2                                                                                                                                                                                                        | 5                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | Rajasthan                                                                                                                                                                                                | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | Telangana                                                                                                                                                                                                | 0                                                                                                                                                                                                        | 3                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 2                                                                                                                                                                                                        | 5                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | Uttar Pradesh                                                                                                                                                                                            | 0                                                                                                                                                                                                        | 6                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 11                                                                                                                                                                                                       | 17                                                                                                                                                                                                       |
|                                                                                                                                                                                                          | TOTAL:                                                                                                                                                                                                   | 2                                                                                                                                                                                                        | 28                                                                                                                                                                                                       | 4                                                                                                                                                                                                        | 29                                                                                                                                                                                                       | 63                                                                                                                                                                                                       |
| Hindustan Petroleum Corporation Limited (HPCL):                                                                                                                                                          | Hindustan Petroleum Corporation Limited (HPCL):                                                                                                                                                          | Hindustan Petroleum Corporation Limited (HPCL):                                                                                                                                                          | Hindustan Petroleum Corporation Limited (HPCL):                                                                                                                                                          | Hindustan Petroleum Corporation Limited (HPCL):                                                                                                                                                          | Hindustan Petroleum Corporation Limited (HPCL):                                                                                                                                                          | Hindustan Petroleum Corporation Limited (HPCL):                                                                                                                                                          |
|                                                                                                                                                                                                          | Chhatisgarh                                                                                                                                                                                              | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | Karnataka                                                                                                                                                                                                | 0                                                                                                                                                                                                        | 3                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 3                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | Maharasthra                                                                                                                                                                                              | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | Telangana                                                                                                                                                                                                | 0                                                                                                                                                                                                        | 4                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 4                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | West Bengal                                                                                                                                                                                              | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | TOTAL:                                                                                                                                                                                                   | 0                                                                                                                                                                                                        | 10                                                                                                                                                                                                       | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 10                                                                                                                                                                                                       |
| Bharat Petroleum Corporation Limited (BPCL):                                                                                                                                                             | Bharat Petroleum Corporation Limited (BPCL):                                                                                                                                                             | Bharat Petroleum Corporation Limited (BPCL):                                                                                                                                                             | Bharat Petroleum Corporation Limited (BPCL):                                                                                                                                                             | Bharat Petroleum Corporation Limited (BPCL):                                                                                                                                                             | Bharat Petroleum Corporation Limited (BPCL):                                                                                                                                                             | Bharat Petroleum Corporation Limited (BPCL):                                                                                                                                                             |
|                                                                                                                                                                                                          | Andhra Pradesh                                                                                                                                                                                           | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | Gujarat                                                                                                                                                                                                  | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 1                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | Karnataka                                                                                                                                                                                                | 0                                                                                                                                                                                                        | 3                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 3                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | Maharasthra                                                                                                                                                                                              | 0                                                                                                                                                                                                        | 2                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 2                                                                                                                                                                                                        |
|                                                                                                                                                                                                          | TOTAL:                                                                                                                                                                                                   | 0                                                                                                                                                                                                        | 7                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 0                                                                                                                                                                                                        | 7                                                                                                                                                                                                        |