Several people who have linked their Aadhaar with LPG distribution are either not receiving subsidy on time or not receiving the SMS. On the other hand, some people are receiving multiple SMS with different customer IDs about LPG refill and subsidy not related with them
The Supreme Court on 23 September 2013, in an interim order, directed that “no person should suffer for not getting the Aadhaar card in spite of the fact that some authority had issued a circular making it mandatory.”
However, despite this clear ruling, state-run oil marketing companies (OMC), like the Hindustan Petroleum Corp Ltd (HPCL), Bharat Petroleum Corp Ltd (BPCL) and Indian Oil Corp (IOC) are enforcing citizens to compel with the UID/Aadhaar requirement. This is not only causing troubles to citizens but lakhs of them are facing hardship due to the forceful implementation of Aadhaar for cooking gas (LPG).
And this is not limited to people who have not submitted their Aadhaar. Several consumers, who have enrolled and submitted their Aadhaar to the LPG distributor, are either not receiving the subsidy on time or not receiving any SMS. On the other hand, several people are receiving SMS about the LPG refill booking, cash memo and delivery, for a consumer number that is not theirs.
For example, I have neither enrolled for the Aadhaar nor I have linked my bank account with any UID number. Yet, I continue to receive SMS from my OMC giving details, about subsidy being deposited into a bank account that does not belong to me. Despite complaining to the OMC and LPG distributor, there is no action to delink my mobile number from the other consumer.
One of the readers of Moneylife, has been receiving SMS from OMC for three-four different consumer numbers. That too, when he has not received his own subsidy for the LPG refill in his own bank account. See the image below, the reader received SMS about booking of a LPG refill. Next message says ‘cash memo no165409 prepared on 27.12.2013 for Rs1044.50’ and his refill will be delivered shortly. The very next message (for the same booking number) says ‘subsidized cash memo 167664 dt 03.01.14 for Rs1273.5 prepared and the refill will be delivered shortly’. Then suddenly on 18th January, he received an SMS stating that his ‘booking no265829 is cancelled!’ (see the image below)
There are two things wrong in these messages. One, the consumer number does not belong to the reader and second, he is still waiting for his rightful delivery of LPG refill since more than 20 days. Interestingly, he still has to get the subsidy for his last refill and the distributor had told him that he would receive it in next 10-12 days.
Several readers of Moneylife have complained about threats being received from their LPG distributors for submitting the UID/Aadhaar number. All the distributors are using the one line threat, "You will not get any subsidy, if you do not provide your Aadhaar and link it to your bank account."
Even the social media is full of people who are having a tough time due to Aadhaar linkage with LPG refill and subsidy. Here is one such tweet that shows the mess of Aadhaar, LPG refill booking and direct benefit transfer (DBTL) scheme. The person has received subsidy through DBTL in his bank account without him booking the LPG refill!
Meanwhile, the OMC continue to send SMS asking people to submit their Aadhaar number to LPG distributor and link it with their bank account.
This is not only illegal but also can be construed as contempt of court. Under Article 141 of the Constitution of India, "the law declared by the Supreme Court shall be binding on all Courts within the territory of India." To declare means to announce opinion. Thus the law declared by the Supreme Court is the law of the land. It is a precedent for itself and for all Courts, Tribunals and authorities in India (Rupa Ashok Hurra vs. Ashok Hurra (2002) 4 SCC 388).
Following the interim order from the apex court, the Ministry of Petroleum and Natural Gas (MoP&NG) filed an ‘Application for clarification/ modification of order dated 23 September 2013. The Supreme Court, however, simply refused to do so. On 26th November, the Supreme Court said, its 23rd September order remains unmodified. Yet, HPCL, BPCL and IOC and their distributors continue to harass customers under the name of Aadhaar.
This is despite, the Nandan Nilekani-led Unique Identification Authority of India (UIDAI), maintaining its UID or Aadhaar is 'free and voluntary' and is meant for 'residents'.
The Supreme Court is likely to hear the matter on 28 January 2014 and take these ‘welfare agencies’ and the concerned ministries to task.
(This is the first part of two part series. The second part describes steps needed to be taken by customers harassed by the OMCs for LPG refill and subsidy)
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The downward move that started on Friday has been arrested for now. A close below 6,280 for the Nifty will again open up the possibility of a decline
The Sensex opened at 21,084 and the Nifty opened at 6,262. The indices soon hit their low at 21,001 and 6,243. After which they moved to green zone and remained in the positive for the entire session. In the last hour of the trading session the benchmark hit the day’s high and closed almost at the same level. The Sensex hit a high of 21,221 and closed at 21,205 (up 141 points or 0.67%) while the Nifty hit a high of 6,307 and closed at 6,304 (up 42 points or 0.68%). The NSE recorded a lower volume of 50.90 core shares.
The Reserve Bank of India said on Friday, 17 January 2014, that the liquidity conditions are undergoing some stress in the recent period, primarily on account of the build-up of cash balances of the Government of India. In order to address the temporary liquidity deficit situation, the Reserve Bank of India has been infusing additional liquidity through 7/14/28 days term repo auctions in addition to the existing overnight repo under liquidity adjustment facility and standing liquidity facilities. The current assessment suggests that the strain on market liquidity is likely to remain enduring in view of the fiscal targets set for the year as well as projections for aggregate credit growth, warranting the need to provide liquidity of a more permanent nature. Accordingly, the Reserve Bank has decided to conduct Open Market Operations by purchasing the following government securities for an aggregate amount of Rs10,000 crore on Wednesday, 22 January 2014, through multi-security auction using the multiple price method.
Investors also cheered Bharatiya Janata Party's (BJP's) prime ministerial candidate Narendra Modi's economic vision for India in his speech on Sunday, 19 January 2014, wherein he said the emphasis will be on urbanisation, infrastructure and inflation control and said his wish list includes setting up 100 new smart cities and introduction of bullet trains to all four corners of the country.
The Congress-led government in Maharashtra has taken a leaf out of the books for Aam Admi Party in Delhi and decided to reduce 15% to 20% cut in power tariff charged to domestic consumers, industries and powerlooms by the state-run Maharashtra State Electricity Distribution Company (MahaVitaran). However the decision is not applicable to Mumbai consumers who get power supply from Tata Power, Reliance Infrastructure and BrihanMumbai Electric Supply & Transport.
US indices closed flat mostly with the negative bias on Friday. The US stock market will remain closed today for the Martin Luther King Jr. holiday.
Asian indices closed mostly in the negative. Seoul Composite was the top gainer which rose 0.48% while Hang Seng was the top loser which fell 0.88%.
European indices were showing mixed performance while US Futures were trading marginally in the negative.
Using a confluence of six different factors, Morgan Stanley India’s latest report is bullish on Tata Motors, Axis Bank, Lupin, ICICI Bank and Maruti Suzuki. However, there is fine print that investors should be aware of
Morgan Stanley’s India (MSI) Equity Strategy report states that it is bullish on Tata Motors, Axis Bank, Lupin, ICICI Bank and Maruti Suzuki. On the other hand, MSI is bearish on State Bank of India (SBI), Ambuja Cements, Hero MotoCorp, Hindustan Unilever (HUL) and Jindal Steel. Their findings are based on six key drivers namely: sell-side consensus opinion, institutional ownership, relative valuations, consensus earnings expectations, long-term relative trailing performance, and finally, trading volumes relative to history.
1. Sell-side consensus opinion
Assessing the bullishness and bearishness, according to MSI, the more bullish, the less likely the stock performs. Does this mean that companies, according to this chart, like BPCL, Power Grid Corporation (PGC), Cairn India, ONGC are unlikely to perform?
2. Institutional ownership
According to MSI research, stocks will find it difficult to move if there is high institutional ownership possibly due to a lower float and thus lower liquidity. But, according to the chart, the stocks that have increased FII ownership are the very same stocks which MSI are bullish. ICICI Bank saw increased FII ownership by 5% relative to MSCI India Index. Similarly, Axis Bank saw a 2% increase in FII ownership as did Tata Motors.
3. Relative valuations
According to MSI research, if a company is valued highly, then it is an “impediment” for share price movement. Therefore, stocks having a higher trailing price-to-book ratio are unlikely to move up further. According to their chart, Hindustan Unilever, Asian Paints, ITC, TCS and Hero MotoCorp are highly valued, having price-to-book ration of 13.7x, 4.9x, 4.1x, 3.5x and 3.2x respectively. Concurrently, MSI is bearish on Hero MotoCorp and Hindustan Unilever.
4. Consensus earnings expectations
According to MSI research, it is not wise to fight against consensus expectations. The report said, “We point out that sometimes the consensus is right, so taking a counter-consensus view does not work.” Thus, according to their chart below stocks like Tata Steel, Ranbaxy Labs, Tata Motors, HCL Technology, Coal India have seen upgraded consensus earnings. Sesa Sterlite, Ambuja Cements, Jayprakash Associates, ACC and DLF had downgraded consensus earnings.
5. Long-term relative trailing performance
This is the most commonly used indicator and simply a rear-view mirror into a stock’s past performance. According to MSI, some of the best performers, in the last five years, in terms of CAGR growth, has been: HCL Technologies, Tata Motors, IndusInd Bank, Bajaj Auto and TCS. The worse have been BHEL, DLF, NTPC, NMDC and Tata Power. As one saying goes, past performance is no guarantee of future success.
6. Trading volumes relative to history
According to MSI research, traded volumes is signifies interests in a stock. The report says, “falling trading volumes that signify waning interest and vice versa.” According to the chart, there is a lot of interest on Power Grid Corporation, Punjab National Bank, Bank of Baroda, Sesa Sterlite and Ranbaxy Laboratories. MSI research seems to have taken a contrarian view by picking Tata Motors in this.
Is this is another of those research reports written to align views with business interests. In its disclosure statement, MSI expects to receive compensation, in one way or other, from the some of the very companies it is bullish on. For instance, within the next three months, the disclosure statement read, “In the next 3 months, Morgan Stanley expects to receive or intends to seek compensation for investment banking services from AXIS Bank, BHEL, ICICI Bank, Jindal Steel & Power, Lupin Ltd, State Bank of India, Tata Motors.” Moreover, as of 31 December 2013, it also “beneficially owned 1% or more of a class of common equity securities of the following companies covered in Morgan Stanley Research: AXIS Bank, ICICI Bank, Jindal Steel & Power, Tata Motors.” Jindal Steel & Power is the only stock which MSI is bearish on in which it owned & provided advice.