Closure of Adani cement plants hits Himachal's exchequer hard

Ambika Sharma

Solan, January 5

The state was incurring losses worth crores due to the closure of two cement manufacturing plants of the Adani group since December 15.

Sale of other brands up

• Cement dealers said that the average sales of Shree Cement, which was 9,000 to 10,000 metric tonnes (MT) earlier, had increased to 21,000 MT to 22,000 MT in December 2022
• Since the stock of ACC and Ambuja Cements Limited had dried up owing to closure of their plants, the demand was being met with Shree Cement and other companies like Ultra Tech
• An increase of Rs 58,000 was registered in the collection of taxes like CGCR at the Parwanoo barrier. This tax is levied on the transportation of commodities like cement

Various taxes on cement like goods and services tax (GST), value added tax (VAT), royalty in lieu of using minerals like limestone, electricity duty, certain goods carried by road (CGCR) and additional good tax (AGT) etc., went into the state treasury on a monthly basis.

Devkant Prakash Khachi, Deputy Commissioner, State Taxes and Excise, Solan, confirmed that the closure of Ambuja Cement Limited’s Darlaghat-based plant has led to loss of about Rs 3 crore on account of CGCR and AGT and up to Rs 12 lakh in lieu of VAT on high speed diesel sale.

In addition to this, loss of royalty on use of minerals like limestone was Rs 5.30 crore while GST loss of Rs 27.2 crore and loss of electricity duty (ED) of Rs 14.5 crore would be suffered if the Darlaghat-based plant remains closed for a month.

Similarly, loss of Rs 3.30 crore from royalty, Rs 5.80 crore from AGT and CGCR, Rs 12.20 crore from ED and Rs 13 lakh from VAT would be suffered by the state due to the closure of ACC plant in Barmana.

According to figures secured from the two plants, as much as Rs 68 crore are earned from the Ambuja Cements Limited and Rs 50 crore from the ACC Barmana on a monthly basis by the state government. The two plants have been closed for the last 22 days and there was little likelihood of the manufacturing work being resumed in the near future as several rounds of meetings have failed to yield any positive outcome.

A senior official of the State Taxes and Excise Department said a loss of Rs 15 crore to Rs 20 crore has been caused due to the closure of two cement plants of the Adani group since December 15. The two plants yield monthly excise duty ranging from Rs 42 crore to Rs 45 crore to the department. A part of these taxes like CGCR and ADT are now being earned from transportation of cement from the other states, but loss was incurred on GST and VAT.