Essar Oil down over 2% on SC order to pay tax dues

Shares of Essar Oil declined 2 percent on a CNBC-TV18 news that the Supreme Court has asked the company to pay sales tax dues worth Rs 1,000 crore by July 31.

The company has an aggregate 8,000 crore sales tax dues, media reports had earlier suggested.

On July 9, the Guajrat government had sealed three bank accounts of the company, in a bid to recover the dues.

[caption id="attachment_380164" align="alignleft" width="380"] Reuters[/caption]

Reacting to the move by the government, Essar Oil had said that it intends to pay Rs 6,169 crore dues and of that Rs 1,000 crore would be paid in 30 days.

"Essar Oil is surprised and disappointed by the Gujarat government's unexpected step of attaching the bank accounts of Essar Oil despite the company clearly stating its intent to pay the sales tax due to the state," a report in The Economic Times quoted from a company statement.

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The state government had allowed Essar Oil to defer its sales tax payment for 17 years, as an incentive to start its Vadinar refinery. However, the Supreme Court in January said the company was entitled to enjoy the deferment as the company had missed the deadline, the report said.