SME Times News Bureau | 18 Feb, 2012

 

Essar Oil Friday reported a Rs.3,986 crore net loss for the third quarter of the current fiscal after accounting for sales tax that it had not been paying since 2008 under a tax deferral programme that the Supreme Court ruled the company was not entitled to benefit from.

The company had posted a net profit of Rs.273 crore in the like period of 2010-11.

"The company registered a net loss of Rs.3,986 crore for the third quarter of the current fiscal (Q3 FY 2011-12) on account of an exceptional debit of Rs.4,051 crore towards reversal of sales tax deferral income accounted during May 2008 to December 2011 pending decision on its review petition in the Supreme Court," Essar Oil said in a statement to the Bombay Stock Exchange (BSE).

On Jan 17, 2012, the Supreme Court had set aside a Gujarat High Court judgment permitting Essar Oil to avail sales tax deferral benefit from the state government.

The company said it has filed a review petition in the apex court.

According to the company, its net worth eroded by 54 percent to Rs.2,854 crore.

Its total income in the period under review grew by 4.92 percent at Rs.12,941 crore from Rs.12,333 crore for the quarter ended Dec 31, 2010. 

The gross margin for the refinery business in the third quarter was $6.07 per barrel compared to $7.21 per barrel in the like quarter of 2010-11.

The company said it was focusing on completing phase-I expansion and optimisation of projects at the Vadinar refinery by March-September for better cash flows, L.K.Gupta, chief executive and managing director, said. 

The company envisages expanding refining capacity to reach 20 million metric tonnes per annum by september 2012.