Mumbai, Oct. 8 -- The Centre has proposed changes to the Petroleum Act, 1934, that would replace criminal action for certain licence breaches with administrative adjudication and civil penalties. The Ministry of Petroleum and Natural Gas has invited comments from the public and industry stakeholders on the draft amendments, which propose replacing Sections 23 and 25, inserting Sections 23A to 23E and modifying Section 24.

Under the proposed framework, an adjudicating officer could impose a civil penalty of up to Rs. 25 mn for a first breach of petroleum licence terms and up to Rs. 50 mn for a second or subsequent violation. The officer could also direct licence holders to take corrective measures or stop specified actions, and recommend suspension, revocation or restriction of a licence. Decriminalisation would not apply where a violation threatens public safety or causes grievous hurt or death.

Unauthorised petroleum operations could attract imprisonment of up to three years, a fine of up to Rs. 250 mn, or both. Continued violations could bring an additional fine of up to Rs. 1 mn for each day. Dishonestly obtaining a licence through misrepresentation or impersonation could result in imprisonment of up to five years, a fine, or both.

Damaging petroleum facilities, stealing petroleum or endangering people could attract imprisonment of up to five years or a fine of up to Rs. 150 mn for a first offence. For a second or subsequent offence, the punishment could rise to seven years in prison or a fine of up to Rs. 250 mn. Damage to designated critical petroleum infrastructure could result in imprisonment of up to 10 years and a fine of up to Rs. 250 mn, or the cost of the damage, whichever is lower.

The Centre could designate facilities used for petroleum production, imports, storage, refining, transportation or blending as critical infrastructure. The draft also covers obstructing authorised inspections, failing to report accidents and submitting false or misleading records, with higher penalties for repeat violations. The ministry said the changes respond to outdated penalties, noting that the law's existing maximum fine of Rs. 1,000 was set when petrol cost Rs. 0.90 per litre in 1970. Comments have been sought within 30 days of publication.

Published by HT Digital Content Services with permission from Construction World.