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Informist, Tuesday, Jun. 30, 2026

 

NEW DELHI – The Supreme Court Tuesday ordered status quo on a Karnataka High Court order that allowed reopening of ethanol allocation by oil marketing companies Bharat Petroleum Corp. Ltd., Hindustan Petroleum Corp. Ltd., and Indian Oil Corp. Ltd. for ethanol supply year 2025-26 (Nov-Oct). On Jun. 16, the high court had asked the oil marketing companies to consider Vinp Distilleries and Sugars Pvt. Ltd.'s representation for enhancement of ethanol procurement to honour the agreement between the parties.

 

The apex court issued a notice to Vinp Distilleries and others on BPCL's plea challenging the high court's order. Till the next date of hearing on Jul. 16, there shall be a status quo on the high court order, said a bench of Justice M.M. Sundresh and Justice Sheel Nagu. 

 

Attorney General for India R. Venkataramani, appearing for BPCL, said the high court's recent order directing reopening of ethanol allocation for ethanol supply year 2025-26, which has already been concluded and implemented, would destabilise the national policy of 20% ethanol blending with petrol. Such petitions are pending before several high courts, said Venkataramani, seeking liberty to file a transfer plea to decide on the issue.

 

Venkataramani said the ethanol allocation exercise attained finality on Oct. 17, and allocations were communicated to 378 suppliers for a total supply of 10.50 billion litres of ethanol, of which 6.80 billion litres had already been supplied by them by Jun. 18. If one supplier's quota was enhanced, other similarly placed suppliers would claim parity, thus opening the floodgates for litigation and putting the supply chain in a complete disarray, he said. 

 

Bharat Petroleum is currently the industry coordinator for ethanol blended petrol programme for the 20% blending target, for which cumulative offers for supply of 17.59 billion litres were received pursuant to a tender notice. BPCL had allocated procurement quantities to various suppliers for a total of 10.48 billion litres of ethanol.

 

Vinp Distilleries has established a dedicated ethanol plant and was engaged in the manufacture and supply of denatured anhydrous ethanol among other allied products after responding to an expression of interest issued by the oil marketing companies in 2021. Vinp Distilleries had entered into a long-term offtake agreement with oil marketing companies in 2022. The agreement formed part of the government's ethanol blending programme. In this, dedicated ethanol plants were required to manufacture ethanol for supply to oil marketing companies and were not permitted to supply ethanol produced at such plants to third parties.

 

Last year, the oil marketing companies floated a tender inviting bids for the supply of 10.50 billion liters of denatured anhydrous ethanol for ethanol supply year 2025-26. Vinp Distilleries  participated in a pre-bid meeting pursuant to the notification of the tender and sought clarification with regard to the status of preferential allocation for the year. Vinp Distilleries came to know that it was allotted a quantity of only 39.20 million litres ethanol for supply as against the bid agreement of 92.60 million litres, which led to a shortfall of 63.30 million litres from the agreed allocation. Complaining of the short allotment, Vinp Distilleries moved the high court.

 

Vinp Distilleries said that it had invested huge sums of money running into billions of rupees only for the production of ethanol and it can only offer it and remain only as a dedicated ethanol plant. The oil marketing companies exercise an absolute monopoly over the procurement of ethanol and the company's production of ethanol cannot be supplied to any other private entity, said Vinp Distilleries.  

 

At 1304 IST, shares of BPCL traded 0.8% higher at INR 303.30 on the National Stock Exchange, those HPCL were up 1.3% at INR 394.55, the shares of IOC were unchanged at INR 139.18.  End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Surya Tripathi

Edited by Akul Nishant Akhoury

 

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