Coal India modifies e-auction clauses
5 May 2014 9:56 PM GMT
State-owned CIL has modified clauses pertaining to spot and forward e-auctions of coal to include a provision that says both parties shall be entitled to claim and recover from the other excess or differential tax and statutory levies.
The clause before the amendment only said sale under each auction shall be individual, independent, unique and complete transaction.
The modified clause reads: ‘While the sale under e-auction is independent, both parties shall be entitled to claim and recover from the other any excess or differential tax and statutory levies ...at any time within a period of three years from the date of which the sum becomes recoverable.’
The parties shall have a lien on any sums of money belonging to the other, which may come into possession or control to the extent of the sum recoverable from the other, according to the modification.'‘The... modification of clauses of spot and for-ward e-auction may be incorporated in e-auction scheme with immediate effect,’ Coal India Ltd (CIL) said in a letter to subsidiaries. Besides, there are couple of new clauses in the e-auction scheme. Under the additional clause to be introduced with the immediate effect, ‘the successful buyer shall pay any additional sum which may become payable by the seller under the statutory provision over and above the amount claimed in the invoice’.
Coal India Ltd is the world's largest producer of coal, sells 10 per cent of its output through e-auction. The miner produces more than 80 per cent of the country's coal.
E-auction was introduced to provide access to coal for buyers who are not able to source the fuel through available institutional mechanisms.
The purpose of forward e-auction is to provide equal opportunities to all intending coal consumers to purchase the fuel for own consumption through single window services as per requirement and at a price determined by themselves through the process of on-line bidding.
Forward e-auction facilitates all consumers of coal with choices of booking coal on line, enabling them to buy through a simple and consumer-friendly system.
A high-level panel had earlier described e-auction conducted by Coal India as a ‘tool for manipulation’ that benefits only ‘big traders’ and questioned the need for this method of sales when the country is reeling under a shortage of the fuel. The Standing Committee on Coal and Steel had said in its report that it was ‘surprised to note what exactly prompts CIL o go for e-auction despite the coal shortage in the country...the process of e-auction, which though generates good revenue for CIL, is also a big tool for manipulation’.
The panel recommended in the report that the method should be ‘checked soon’ and a more transparent regulatory and monitoring mechanism be put in place.
The clause before the amendment only said sale under each auction shall be individual, independent, unique and complete transaction.
The modified clause reads: ‘While the sale under e-auction is independent, both parties shall be entitled to claim and recover from the other any excess or differential tax and statutory levies ...at any time within a period of three years from the date of which the sum becomes recoverable.’
The parties shall have a lien on any sums of money belonging to the other, which may come into possession or control to the extent of the sum recoverable from the other, according to the modification.'‘The... modification of clauses of spot and for-ward e-auction may be incorporated in e-auction scheme with immediate effect,’ Coal India Ltd (CIL) said in a letter to subsidiaries. Besides, there are couple of new clauses in the e-auction scheme. Under the additional clause to be introduced with the immediate effect, ‘the successful buyer shall pay any additional sum which may become payable by the seller under the statutory provision over and above the amount claimed in the invoice’.
Coal India Ltd is the world's largest producer of coal, sells 10 per cent of its output through e-auction. The miner produces more than 80 per cent of the country's coal.
E-auction was introduced to provide access to coal for buyers who are not able to source the fuel through available institutional mechanisms.
The purpose of forward e-auction is to provide equal opportunities to all intending coal consumers to purchase the fuel for own consumption through single window services as per requirement and at a price determined by themselves through the process of on-line bidding.
Forward e-auction facilitates all consumers of coal with choices of booking coal on line, enabling them to buy through a simple and consumer-friendly system.
A high-level panel had earlier described e-auction conducted by Coal India as a ‘tool for manipulation’ that benefits only ‘big traders’ and questioned the need for this method of sales when the country is reeling under a shortage of the fuel. The Standing Committee on Coal and Steel had said in its report that it was ‘surprised to note what exactly prompts CIL o go for e-auction despite the coal shortage in the country...the process of e-auction, which though generates good revenue for CIL, is also a big tool for manipulation’.
The panel recommended in the report that the method should be ‘checked soon’ and a more transparent regulatory and monitoring mechanism be put in place.
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