Mathura Prasad Mahto at a news meet in Ranchi on Wednesday. (Hardeep Singh)

Ranchi, Aug. 3: A state cabinet proposal allowing the food and civil supplies department to pay a subsidy of Rs 11 per LPG cylinder directly to oil companies has failed to impress the latter, thwarting the government’s efforts to ensure consumers and distributors do not have to pay extra.

Food and civil supplies minister Mathura Prasad Mahto today said the oil companies were not willing to accept the new proposal, as they sought to continue with adjustment of subsidies as against value added tax (VAT).

Addressing a news meet, Mahto said, “The top executives of leading oil companies supplying domestic LPG cylinders in Jharkhand have informed in black and white that they will not accept subsidy amounts directly from the food and civil supplies department. The funds meant for the purpose are therefore lying idle.”

He added that he would soon request the chief minister to press for the oil companies to accede to the new terms.

Traditionally, subsidy amounts for domestic LPG cylinders are adjusted through taxes charged by the state government. The food and civil supplies department, in turn, repays the subsidies to the commercial taxes department.

However, the cabinet came up with the new proposal in March, with chief minister Arjun Munda clarifying that the was moved aimed at preventing misuse of subsidised domestic LPG for commercial purposes.

Munda has also been in the eye of a storm for hike in LPG rates.

Replying to a question, Mahto said his department had received over 65 lakh applications for PDS ration cards. The data entry has almost been completed and new ration cards will be issued from next month.

Besides, the department will float tenders for setting up outlets under the “dal-bhat yojana” across the state on August 9. However, National Agricultural Co-operative Marketing Federation (Nafed) has refused to run the civil supplies distribution centres.

“Nafed is willing to supply materials, but not ready to run the centres. Rice is being distributed at all PDS outlets on the 17th and 25th days of every month and kerosene on 15th and 25th. If any PDS dealer is caught selling goods on the black market, we will take tough measures against them. In the recent past, over 806 PDS dealers have been taken to task. Licenses of over 292 dealers were cancelled. But, fixing a vendor or retailer selling kerosene for Rs 35 to 40 a litre is beyond our jurisdiction,” he added.

On huge quantities of foodgrains meant for BPL families rotting in State Food Corporation (SFC) godowns, the minister said the rural development department was in charge of distribution among the poor.