The audit report by the Comptroller and Auditor General of India (CAG) tabled in Parliament on Thursday has stated that GAIL’s violation of norms related to the supply of natural gas has resulted in a revenue loss of Rs227.4 crore.
The ministry of petroleum and natural gas had restricted the use of APM (administered price mechanism) gas only for fertiliser and power firms supplying electricity to the grid for distribution to the consumers through public utilities.
The ministry accordingly revised the rates for APM gas supplied to consumers other than power and fertiliser sector consumers to Rs3,840 per metric standard cubic metre from Rs3200.
But, GAIL (India) continued to supply natural gas at pre-revised APM rates of Rs3,200, in violation of the ministry’s directive to ineligible consumers generating and supplying electricity to their customers at commercial rates through the grid.
“GAIL extended benefit to private parties taking shelter under the argument that the matter stood referred to the ministry for clarification and leaving the matter unresolved for an indefinite period, which resulted in loss of revenue of Rs227.4 crore during April 2006 to March 2010,” the CAG said.