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Thursday, Sep 19, 2019

Punjab govt slashes VAT on natural gas

cities Updated: Sep 11, 2019 01:06 IST
HT Correspondent
HT Correspondent

In a bid to encourage industries to shift to eco-friendly gas, the state cabinet on Tuesday decided to cut down VAT on natural gas, in gaseous state other than compressed natural gas, from 14.3 to 3.3%.

At present, the rate of VAT on Natural Gas is 13%+10% surcharge i.e. 14.3% in Punjab. The major consumer of gas is National Fertilisers Limited (NFL), which uses the gas at its plants at Bathinda and Nangal. Natural gas is also consumed in very small quantity by select industries and the transport sector.

Before March 2015, VAT rate on natural gas was 5.5%+10% surcharge i.e. 6.05%. From March 2015 onwards, VAT rate on natural gas was increased from 6.05% to 14.3%. Due to increase in VAT, NFL started interstate billing of natural gas due to which VAT collection on natural gas decreased. The VAT collection on natural gas from the years 2014-15 to 2018-19 came down considerably — from ₹105.77 crore to ₹5.67 crore, which had further shown a steep decline to ₹1.84 crore till June 2019, during financial year 2019-20.

In another decision, the cabinet also approved the extension of Suhelewala distributory, Jalalabad, at a capital outlay of ₹1.35 crore under the medium irrigation (plan) budget grant.


The cabinet took a series of decision with respect to housing allotment, including restriction of flats for allotment of land under ECGHS scheme to 40 per acre, and 3% reservation of residential plots for government employees under PUDA and special authorities’ jurisdiction.

An official spokesperson said after the meeting that the decision to put a curb on per acre flats, allotted to the Employees Cooperative Group Housing Societies (ECGHS) by various development authorities, had been taken in pursuance of the announcement made by CM during his speech in the Punjab Vidhan Sabha on February 20, 2018, and in line with the notification issued on October 18, 2018.

Further, in line with the MC’s approval on June 15, 2017, the council of ministers approved the reservation policy for allotment of land/sites falling under the jurisdiction of PUDA and other special authorities. The reservation policy envisages 3% residential plots/houses/apartments for allotment to government employees by development authorities, municipal corporations, improvement trusts or any other government agency.


As a special case, the cabinet gave ex post facto approval to disbursement of financial benefits to the tune of nearly ₹31 lakh to the legal heirs of Neha Shoree, zonal licensing drug authority, Mohali, who was shot dead on duty on March 29 this year.

The cabinet felt Shoree had performed her duties fearlessly with valour, dedication and hard work. It decided, therefore, to grant ex post facto approval for financial benefits including ex-gratia (₹20 lakh), besides death-cum-retirement gratuity Rs 6.99 lakh, leave encashment ₹3.28 lakh as per rules.

Shoree was selected as drug inspector in the department of health and family welfare through the Punjab Public Service Commission in 2007. She joined Rupnagar district in October 2007 and in 2013 the department had given her the responsibility of the district zonal licensing authority.

First Published: Sep 11, 2019 01:06 IST