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RTI News-IFFCO Saved Crores in Cheap Ammonia Imports, But Didn't Pass Subsidy to Farmers

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Fertiliser ministry's RTI reply says the company gained from the Centre’s intervention but retained subsidy benefits, forcing the government to recover Rs 765.19 crore. The matter is now in Delhi high court.

The Indian Farmers Fertiliser Cooperative Limited (IFFCO), one of India’s biggest cooperative society which is in the core business of manufacturing and selling fertilisers, had procured cheap ammonia from Oman but sold it at the prevailing market prices without passing on subsidy benefits to farmers, the Ministry of Chemicals and Fertilisers recently submitted before the Central Information Commission (CIC). The ministry said that an amount of Rs 765 crore was subsequently recovered from the company.

‘IFFCO did not pass benefits to farmers’

CIC said the ministry submitted that “IFFCO had not passed on the cheap input cost of ammonia imported under Ammonia OffTake Agreement (AOTA) by IFFCO in the form of lower prices to farmers.”

He also recorded that “fertilizer subsidy was paid by the government to make available fertilizer to the farmers. The subsidy which was meant for farmers was paid to the companies for transferring the same to the farmers in the form of reduced MRP of fertilizer. The AOTA between IFFCO and OMIFCO was materialized with the intervention of the Government of India.”

“In other words, by not reflecting the cheap input cost of imported ammonia in the form of lower MRP, as compared to other companies, IFFCO had not passed on the entire subsidy received from government to farmers and has unduly benefited,” the CIC recorded in his order. While the ministry submitted that disclosure of such information could harm the economic interest of the state, the appellant said the matter was in “larger public interest” and, therefore, section 8(1)(a) of the RTI Act did not apply to it.

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