Fert body moves HC on late subsidy payments: Tata Chem

Industry body FAI (Fertiliser Association of India) has filed a petition in the Delhi High Court over delays in fertiliser subsidy payments by the government, Tata Chemicals (TCL) said on Monday. Payment delays will put pressure on cash-flows of the company in the coming quarters, it added.

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"It is a continuing problem and we have asked the government to pay us an interest on delayed subsidy. The total delayed subsidy of TCL is Rs 1,153 crore and while that of the fertiliser industry is Rs 22,000 crore.

"So, we have also given a collective representation to the court to assist us in getting this payment," Tata Chemicals managing director R Mukundan said.

Speaking on the sidelines of the first quarter results of the company, Mukundan said the delayed subsidy is likely to put pressure on it in the coming quarters.

On behalf of the industry, the Fertiliser Association of India has filed a petition in the Delhi High Court seeking 14.75 percent interest on the delayed subsidy payments.

"No bill of the subsidy on the sale of phosphorous and potassium fertilisers since April has been dispersed by the government," FAI director-general Satish Chander said. However, the government has marginally reduced the fertiliser subsidy at Rs 65,971.50 crore for the next fiscal 2013-14, as against the revised estimate of Rs 65,974 crore in 2012-13 fiscal.

Under the fertiliser subsidy, the government will provide Rs 15,544.44 crore for imported urea, Rs 21,000 crore for indigenous (urea) fertilisers, and Rs 29,426.86 crore for the sale of decontrolled fertilisers (DAP, MOP and complexes) at a subsidised rate to farmers.