The Supreme Court on Tuesday ordered a status quo on the Karnataka High Court's direction to consider enhancing ethanol allocation for the Ethanol Supply Year (ESY) 2025-26. The interim order, issued by a bench of Justice MM Sundresh and Justice Sheel Nagu, means the existing allocation process will remain unchanged until the next hearing.
Petition by BPCL
The order came on a petition filed by Bharat Petroleum Corporation Limited (BPCL) challenging the June 16 judgment of the Karnataka High Court. BPCL argued that the high court's direction to reconsider the representation of VINP Distilleries and Sugars Pvt Ltd seeking enhanced ethanol allocation would destabilize the national policy of 20% ethanol blending with petrol (E20).
Attorney General's Arguments
Representing BPCL, Attorney General R Venkataramani contended that ethanol supply contracts for ESY 2025-26 were finalized in October last year, with supplies already underway. He emphasized that the E20 fuel program, aimed at strengthening India's energy security, augmenting farmers' income, and reducing carbon emissions, is still evolving and remains a policy matter for the government.
Venkataramani asserted that no company can claim a legal entitlement to a higher ethanol quota, and judicial directions altering the allocation methodology would interfere with government policy. He described ethanol blending as an ongoing experiment, with its full impact expected to be clearer by next year.
Karnataka High Court's Order
On June 16, the Karnataka High Court directed BPCL, Indian Oil Corporation, and Hindustan Petroleum Corporation to consider VINP Distilleries' representation for enhanced ethanol allocation under a long-term off-take agreement with oil marketing companies. The Supreme Court's status quo order effectively stays that direction pending further hearing.
The bench issued notice and listed the matter for hearing after the summer vacation, ensuring the current allocation process remains undisturbed in the interim.
