Indian oil firm Essar to pay part of tax bill
MUMBAI, July 9 |
MUMBAI, July 9 (Reuters) - Indian refiner Essar Oil said it would pay 10 billion rupees ($179 million) within 30 days in a part settlement of the sales tax it owes, after government officials attached some of its bank accounts.
Essar will make the immediate payment to show its bona fide intent to pay off the amount due, the company said in a statement on Monday.
Essar Oil, 87 percent-owned by London-listed Essar Energy , has been negotiating with the government in the western state of Gujarat for more time to pay $1.24 billion in sales taxes after India's top court dismissed its petition seeking a review of an earlier verdict to defer payment.
Essar, which has already booked a 40 billion rupee loss on its books for the tax liability, hopes to tap increased cash flows from its expanded refinery but has also been in talks with banks to raise funds for the payment.
Essar Oil shares closed down 2.2 percent in a weak Mumbai market on Monday, ahead of the announcement. Essar Energy shares were down 1.7 percent in London trading.
Essar has recently completed a $1.6 billion overhaul and expansion at its Vadinar refinery, raising capacity to around 360,000 barrels per day from 280,000 bpd and adding units that can process cheaper, heavier crude into fuels. ($1=55.95 rupees) (Reporting by Prashant Mehra, editing by Jane Baird)
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