 "Cairn India can't export excess crude: Centre tells HC")
It told a bench of Justice Manmohan that Cairn India was however permitted to sell crude to domestic companies within India but they cannot be allowed to export it.
"They (Cairn India) are permitted by the empowered committee to sell crude to the private companies within the country," Additional Solicitor General (ASG) Tushar Mehta argued before the bench, adding, "this is a government policy which will run uniformly."
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"It is a national policy not to allow crude export till India's demand is met. The government policy on no crude export is applicable across India," he said.
He, however, told the bench that he needed to discuss and seek instructions from the government on the issue.
The counsel representing Cairn India told the bench that they were selling the crude at a lower price and the government was "discriminatory" towards them as the policy has permitted Indian Oil to export.
Accepting the arguments advanced by the ASG, the bench posted the matter for further hearing on February 26.
The government had earlier told the court that its empowered committee of secretaries has decided that Cairn India cannot be allowed to export the excess crude.
The court was hearing the plea of Cairn India seeking directions to the government to permit it to export the excess crude.
It had earlier told the court that a loss of Rs 1,400 crore has been caused to government as the company was forced to sell its share of crude from its Rajasthan oil field to private players at prices 20 per cent less than global rates.
The contention was opposed by the Ministry of Petroleum and Natural Gas which had told the court that the loss to government as calculated by Cairn India was "notional" and the company was incurring no loss either, as it was selling the crude, not picked up by PSUs or the government, to private domestic players.
contract (PSC) it has with the government, it gets 70 per cent of crude produced from the well and rest goes to the government.
Under the PSC, the government or its nominee can pick up the company's share of crude and what is not picked up, could be sold to private players or exported, Cairn had claimed.
However, after the crude is sold, government gets 70 per cent of the profits, it had told the court.
It had claimed that as a result of selling excess crude to private domestic companies like Reliance and Essar, at rates lower than international prices, government was losing about Rs 4.5 crore per day.
Cairn had said it had made several representations to Directorate General of Foreign Trade (DGFT) for permission to export the crude, but did not get any response. Prior to this, it had written to the IOCL to "canalise" export of the crude, but got no response from it as well, it had said.
IOCL is the canalising agent for export of crude. Canalising agents are those through which a product can be imported or exported by companies which do not have permission to do so directly.