Essar Oil Ltd has said that it has secured a loan of Rs 5,000 crore from local banks to meet its sales tax liabilities towards the Gujarat government.
"Essar Oil is confident that with this facility tied up it will be in a position to meet its entire payment obligations. A new credit facility from domestic banks to provide a credit line of up to Rs 5,000 crore to meet its sales tax liability of Rs 6,169 crore,” the company said in a press statement.
According to company officials, the company sales tax deferment benefit under the scheme was about Rs 9,100 crore and it has utilized close to Rs6,300 crore. Thus, the company might have to repay the amount as per the schedule that will be prepared after discussions with the state government of Gujarat.
The company also said that it wll continue to follow up the payment schedule with the state government. The Supreme Court had in January said Essar Oil was not entitled to defer payment of sales tax and the thus the company now has to pay the dues which it believed were rebates from the state.