Beleaguered Dabhol power project is desperately awaiting the finance ministry's nod for extension of ad hoc exemption of import duty ranging between 19 and 24 per cent on power equipment beyond March 31 this year.
The ad hoc exemption was given to Ratnagiri Gas and Power Private Ltd to import as well as re-import components, parts and materials required for revival of its Power block I under 'Adhoc Exemption Order 24/2007' issued on May 5, 2007.
The finance ministry has not accepted the request of power ministry for considering extension of ad hoc exemption.
The ministry had extended this exemption last year also when its validity expired on March 31, 2008.
The power ministry had pleaded finance ministry about this last month that RGGPL could not import required material due to financial constraints.
In a letter dated February 12, the power ministry said RGPPL is arranging funds for import of spares required and requested extension of validity of the exemption till March 31, 2010.
The exemption from import duty ends on March 31, 2009. If the finance ministry does not extends this import duty
exemption order then RGPPL would have to pay customs duty ranging from 19 to 24 per cent.
The import duty, including countervailing duty and special additional duty, would put an additional burden of 19-24 per cent depending upon the classification of components, material or parts.