The Petroleum Act, 1934
1. Title, Scope, and Start Date
(1) This law is called the Petroleum Act, 1934.
(2) It applies to the entire country of India.
(3) The law will start on a date that the Central Government decides and announces in the Official Gazette.
2. Definitions. — In this Act, unless there is anything repugnant in the subject or context:
(a) “Petroleum” means any liquid hydrocarbon or mixture of hydrocarbons, and any inflammable mixture (liquid, viscous, or solid) containing any liquid hydrocarbon.
(b) “Petroleum Class A” means petroleum having a flash-point below twenty-three degrees Centigrade.
(bb) “Petroleum Class B” means petroleum having a flash-point of twenty-three degrees Centigrade and above but below sixty-five degrees Centigrade.
(bbb) “Petroleum Class C” means petroleum having a flash-point of sixty-five degrees Centigrade and above but below ninety-three degrees Centigrade.
(c) “Flash-point” of any petroleum means the lowest temperature at which it yields a vapour that will give a momentary flash when ignited, determined in accordance with the provisions of Chapter II and the rules made thereunder.
(d) “To transport petroleum” means to move petroleum from one place to another in India, and includes moving it from one place to another in India across a territory which is not part of India.
(e) “To import petroleum” means to bring it into India by land, sea, or air, otherwise than during the course of transport.
(f) “To store petroleum” means to keep it in any one place, but does not include any detention happening during the ordinary course of transport.
(g) “Motor conveyance” means any vehicle, vessel, or aircraft for the conveyance of human beings, animals, or goods, by land, water, or air, in which petroleum is used to generate the motive power.
(h) “Prescribed” means prescribed by rules made under this Act.
3. Import, Transport, and Storage of Petroleum
No one is allowed to import, transport, or store any petroleum unless they follow the rules set under Section 4.
No one is allowed to import Petroleum Class A, or transport or store any petroleum, unless they have a licence for that purpose, which they must get according to the rules made under Section 4.
4. Rules for the Import, Transport, and Storage of Petroleum
The Central Government can make rules on the following matters:
(a) Deciding where petroleum can be imported and banning its import in other places.
(b) Setting rules for how petroleum should be imported.
(c) Setting deadlines for when people must apply for licences to import Petroleum Class A and deciding what happens to Petroleum Class A if the licence is not applied for on time or is refused (it may be confiscated or dealt with in another way).
(d) Setting rules for how petroleum should be transported.
(e) Deciding the type and condition of containers and pipelines used to transport petroleum.
(f) Deciding where and under what conditions petroleum can be stored.
(g) Setting rules for the type, location, and condition of containers used to store petroleum.
(h) Deciding the form and conditions of licences for importing Petroleum Class A, and for transporting or storing any petroleum. This includes how to apply for licences, who can grant them, and what fees can be charged for these licences.
(i) Deciding whether the consignor, consignee, or carrier needs to get a licence for transporting petroleum in specific cases.
(j) Allowing combined licences for importing, transporting, and storing petroleum, or for any two of these activities.
(k) Deciding the amount of any poisonous substance that can be mixed with petroleum, and banning the import, transport, or storage of petroleum if the amount of a specified poisonous substance is too high.
(l) Making any other rules needed to properly control the import, transport, and storage of petroleum, including charging fees for services related to these activities.
5. Production, Refining, and Blending of Petroleum
No one is allowed to produce, refine, or blend petroleum unless they follow the rules made under sub-section (2).
The Central Government can make rules about:
(a) Setting the conditions under which petroleum can be produced, refined, or blended.
(b) Regulating how petroleum is removed from places where it is produced, refined, or blended. The government can also prevent the storage or removal of any petroleum (except Petroleum Class A) unless it has passed the required tests.
6. Warning on Receptacles Containing Petroleum Class A
All containers holding Petroleum Class A must have a clear warning label. The label should be stamped, embossed, painted, or printed on the container itself, or if that's not possible, placed nearby. The warning should include the words “Petrol” or “Motor Spirit”, or another clear label to show that the petroleum is dangerous.
However, this rule does not apply to the following:
(a) Small containers (less than 10 litres) of Petroleum Class A that are securely sealed, made of glass, stoneware, or metal, and not meant for sale.
(b) A fuel tank in a motor vehicle or attached to an engine, if the petroleum is used to power the vehicle or engine.
(c) A pipeline used to transport petroleum.
(d) Any tank that is completely underground.
(e) Any other type of container or receptacle that the Central Government may decide to exempt through an official notice in the Gazette.
7. No Licence Needed for Transport or Storage of Limited Quantities of Petroleum Class B or Class C
Even though the law generally requires a licence for transporting or storing petroleum, you do not need a licence if:
For Petroleum Class B:
The total amount you have at one place is 2,500 litres or less.
None of it is stored in a container that holds more than 1,000 litres.
For Petroleum Class C:
The total amount you have at one place is 45,000 litres or less.
The petroleum is transported or stored according to the rules in Section 4.
8. No Licence Needed for Small Quantities of Petroleum Class A
A person does not need a licence to import, transport, or store Petroleum Class A if it is not intended for sale, and the total amount they have does not exceed 30 litres.
Any Petroleum Class A kept without a licence must be stored in securely sealed containers made of glass, stoneware, or metal.
For glass or stoneware containers, the capacity must not be more than 1 litre.
For metal containers, the capacity must not be more than 25 litres.
9. Exemptions for Motor Conveyances and Stationary Engines
The owner of a motor vehicle (car, truck, etc.) or a stationary internal combustion engine (like a generator) does not need a licence for the following:
(a) For the import, transport, or storage of petroleum in the fuel tank of the vehicle or engine.
(b) For transporting or storing Petroleum Class A, as long as it doesn't exceed 100 litres in addition to the amount already in the fuel tank of the vehicle or engine. This petroleum must be used to power the vehicle or engine.
Note: The total amount of Petroleum Class A stored without a licence under clause (b) cannot exceed 100 litres, even if the owner has more than one vehicle or engine.
If Petroleum Class A is stored or transported without a licence under clause (b):
It must be stored safely as described in Section 8(2).
If the amount exceeds 30 litres, it must be stored in a separate, isolated place that is not connected to any area where people live, work, or gather.
10. No Licence Needed for Railways Acting as Carrier
A railway administration (as defined in the Indian Railways Act, 1890) does not need a licence to import or transport petroleum when it is acting as a carrier (i.e., transporting petroleum for others).
11. Exemption for Heavy Oils
The rules in this chapter do not apply to any petroleum that has a flash-point of 93°C or higher.
12. General Power of Exemption
The Central Government can, by official notification, exempt any specific petroleum from all or some of the rules in this chapter.
13. Inspection of Places
The Central Government can appoint an officer (either by name or position) to inspect places where petroleum is being imported, stored, produced, refined, blended, or transported. The officer will check if the containers, equipment, and procedures follow the rules in this chapter.
The Central Government can also make rules to decide how these inspections should be carried out.
14. Inspection and Sampling of Petroleum
The Central Government may, through an official notification, authorize an officer (either by name or by virtue of their office) to enter any premises where petroleum is being imported, transported, stored, produced, refined, or blended. The authorized officer has the power to inspect and take samples of the petroleum found at those locations for testing purposes.
The Central Government may establish rules to regulate:
(a) The process for taking samples of petroleum for testing.
(b) The circumstances under which payment will be made for the value of the samples taken, and how such payments will be made.
(c) The general procedures for officers exercising the powers outlined in this section.
15. Standard Test Apparatus
A standard apparatus for testing the flashpoint of petroleum will be kept with an officer appointed by the Central Government, as announced in the Official Gazette.
The apparatus will be labelled with the words "Standard Test Apparatus". It will be checked and updated as needed, according to the rules under Section 21.
The Standard Test Apparatus will be available for inspection by anyone who wants to check it, if they pay the required fee. Inspections can be done at reasonable times.
16. Certification of Other Test Apparatus
The officer appointed under Section 15 will, upon payment of the required fee (if any), compare any apparatus used to test the flash-point of petroleum with the Standard Test Apparatus. People can submit their apparatus for this comparison.
If the officer finds that the apparatus agrees with the Standard Test Apparatus within the allowed limits, the officer will:
Engrave a special number and the date of comparison on the apparatus.
Issue a certificate stating that the apparatus was compared with the Standard Test Apparatus and meets the required standards. The certificate will also mention any corrections needed in the test results using that apparatus.
The certificate issued under this section will be valid for a period decided by the rules.
The certificate will be considered proof that the apparatus meets the required standards, unless proven otherwise, for as long as the certificate is valid.
The officer will maintain a register of all certificates issued under this section, in the prescribed form.
17. Testing Officers
The Central Government can appoint any officer (by name or position) to test petroleum samples taken under this Act or submitted by any person. The officer can also issue certificates based on the test results.
18. Manner of Test
All tests on petroleum must be done using a test apparatus that has a valid certificate (under Section 16). The officer must consider any corrections specified in the certificate and follow the rules set out in Section 21.
19. Certificate of Testing
After testing petroleum samples, the testing officer will issue a certificate stating whether the petroleum is Petroleum Class A, Class B, or Class C. If it's Class B or Class C, the certificate will also state the flash-point of the petroleum.
The officer must give a certified copy of the certificate to the person who requested it, for a fee. This certified copy can be used as evidence in court to prove the contents of the original certificate.
A certificate issued under this section is admissible as evidence in any legal proceedings related to the petroleum sample tested. It is considered conclusive proof, unless proven otherwise, that the petroleum is Class A, Class B, or Class C, and if it is Class B or Class C, the certificate will also prove the flashpoint.
20. Right to Require Re-Test
If the owner of the petroleum (or their agent) is not satisfied with the results of a test, they can ask for a re-test within seven days of receiving the test result.
To do this, the owner or their agent must apply to the officer (appointed under Section 14) and pay the required fee. Fresh samples of the petroleum will be taken and tested in the presence of the owner, their agent, or a person they choose to represent them.
If the re-test shows that the original test was wrong, the testing officer will:
Cancel the original certificate issued under Section 19.
Issue a new certificate with the correct results.
Provide a free certified copy of the new certificate to the owner or their agent.
21. Power to Make Rules Regarding Tests
The Central Government can create rules about the following:
Standard Test Apparatus:
Setting standards for how the Standard Test Apparatus should be specified, checked, corrected, and replaced.
Fees for Inspection:
Deciding how much will be charged for inspecting the Standard Test Apparatus.
Comparing Test Apparatus:
Regulating the process for comparing other test equipment with the Standard Test Apparatus.
Certificates for Test Apparatus:
Setting the format for certificates issued for test equipment that has been compared with the Standard Test Apparatus and determining how long these certificates are valid.
Register of Certificates:
Deciding how the register of certificates for test apparatus should be maintained.
Fees for Comparison:
Deciding the fees for comparing other test equipment with the Standard Test Apparatus.
Testing Procedure:
Regulating how testing officers should carry out petroleum tests, including how to handle multiple samples from the same lot and the acceptable temperature variations during testing.
Certificates of Petroleum Tests:
Setting the format for certificates of petroleum tests and deciding the fees for issuing them.
Handling Doubts About Petroleum Quality:
If test results suggest that the petroleum quality may not be consistent, the rules can require dividing the petroleum into smaller parts (sub-lots) and testing samples from each part, with the results averaged across all sub-lots.
Re-Test Fees and Refunds:
Setting fees for re-tests under Section 20 and deciding when these fees should be refunded if the original test was wrong.
General Testing Procedures:
Setting rules for how officers should perform all duties related to testing petroleum and handling anything else related to testing.
22. Special Rules for Testing Viscous or Solid Forms of Petroleum
The Central Government can create special rules for testing forms of petroleum that are:
Viscous (thick or sticky),
Solid, or
Contain sediment or thickening ingredients.
These special rules can change or add to the existing rules under this Chapter or the rules made under Section 21 to make them suitable for testing these specific types of petroleum.
23. General Penalty for Offences under this Act
Anyone who does the following can be punished:
(a) Breaks any rule in Chapter I or any related
rules, like importing, transporting, storing, producing, refining, or
blending petroleum illegally.
(b) Breaks any rule made under Section 4 or
Section 5.
(c) If someone holds a license under Section 4 or is in
charge of a place where petroleum is handled, and they break or allow
others to break any condition of that license.
(d) If someone in charge of a place where petroleum is handled refuses
to show any equipment or items used with petroleum during an inspection,
or fails to help the inspector when asked.
(e) If someone refuses to show petroleum, give assistance, or let the
inspector take samples of petroleum during an inspection.
(f) If someone is required by Section 27 to report an
accident involving petroleum, and they fail to do so.
Anyone guilty of these offences can be punished with:
Simple imprisonment for up to one month, or
A fine of up to 1,000 rupees, or
Both imprisonment and fine.
If someone is convicted of this offence once and commits the same offence again, they will be punished more severely with:
Simple imprisonment for up to three months, or
A fine of up to 5,000 rupees, or
Both imprisonment and fine.
24. Confiscation of Petroleum and Receptacles
If someone is convicted of an offence under Section 23, such as importing, transporting, or storing petroleum illegally (as mentioned in clauses (a), (b), or (c)), the Magistrate can order that:
(a) The petroleum involved in the offence be taken away
(confiscated), or
(b) If the person was caught for importing, transporting, or storing
more petroleum than they are allowed, the entire amount of petroleum
they were handling can be confiscated.
Along with the petroleum, the containers (receptacles) used to store it can also be taken away.
The High Court can also use this power to confiscate the petroleum and receptacles if it is reviewing or hearing an appeal about the case.
25. Jurisdiction
Offences under this Act will be tried in different courts based on the location:
In Presidency towns, the case will be tried by a Presidency Magistrate.
Outside the Presidency towns, the case will be tried by:
A Magistrate of the first class, or
A Magistrate of the second class who has been specially authorized by the Central Government.
26. Power of Entry and Search
The Central Government can authorize an officer to enter and search any place if the officer believes that petroleum is being handled (imported, transported, stored, produced, refined, or blended) illegally or against the rules of this Act. The officer can:
Seize, detain, or remove any petroleum if the officer believes an offence has been committed under the Act.
The rules for conducting searches, as stated in the Code of Criminal Procedure, 1973, will apply to searches done by officers authorized under this section.
The Central Government can make rules to guide the authorized officers on how to conduct searches, but these rules must follow the guidelines in the Code of Criminal Procedure.
27. Notice of Accidents with Petroleum
If an accident occurs involving petroleum, such as an explosion or fire caused by the ignition of petroleum or its vapours, and it results in:
Loss of human life,
Serious injury to people or property,
Or any accident of this kind that usually causes such damage,
The person in charge of the place (where petroleum is stored, refined, or blended), or the person in charge of the vehicle or vessel carrying petroleum, must immediately report the accident.
The report should be made within a prescribed time and in a specific way to:
The nearest Magistrate,
The officer in charge of the nearest police station,
The Chief Controller of Explosives.
28. Inquiries into Serious Accidents with Petroleum
If a person is killed in an accident caused by the ignition of petroleum or petroleum vapour, the Magistrate must hold an inquiry under Section 176 of the Code of Criminal Procedure, 1973. This is required unless the Coroners Act, 1871 applies to the situation.
If an accident caused by the ignition of petroleum or petroleum vapour results in serious injury to people or property, but no one is killed, the Magistrate can still hold an inquiry to investigate the cause of the accident.
A Commissioner of Police is also considered a Magistrate for holding such an inquiry.
The results of these inquiries must be submitted to the Central Government, Chief Controller of Explosives, and the State Government as soon as possible.
29. Provisions Relating to Rules
When making rules under this Act, the Central Government can:
(a) Include provisions to protect the public from risks related to the import, transport, storage, production, refining, or blending of petroleum.
(b) Make special rules for certain states or places based on their unique circumstances.Any rule made under this Act must first be published publicly before it can be finalized.
All rules made under this Act must be published in the Official Gazette.
After being made, the rules must be presented to both Houses of Parliament while they are in session for 30 days (which can be in one session or spread across multiple sessions). If both Houses of Parliament agree to change or cancel the rule within that time, the rule will either:
Only take effect in the changed form, or
Not take effect at all.
However, any actions taken under the rule before this change will still be valid, even if the rule is modified or cancelled.
30. Power to apply Act to other substances
This section has been repealed by the
Inflammable Substances Act, 1952 (Section 7).
31. Power to limit powers of local authorities over
petroleum
If any law gives powers to local authorities regarding the
transport or storage of petroleum, the
Central Government can, through a notification in the
Official Gazette:
(a) Limit how the law applies in those areas, or
(b) Restrict how local authorities can use these powers in ways the
Government thinks are necessary.
32. Repeals This section has been
repealed by the Repealing Act, 1938
(Section 2 and the Schedule).
The Schedule lists the enactments that have been
repealed.
MINISTRY OF PETROLEUM & NATURAL GAS
Notification
The Petroleum Rules, 2002.
PART II GENERAL PROVISIONS
3. Restrictions on Delivering and Dispatching Petroleum:
Who Can Receive Petroleum:
No one is allowed to deliver or send petroleum to anyone in India. It can only be delivered to:
The holder of a storage licence or their authorized agent.
A port authority or railway administration.
A person authorized by law to store petroleum without a licence.
Amount and Type of Petroleum:
When delivering or sending petroleum, the type of petroleum and the quantity must match what the recipient is allowed to store under their licence (or without a licence).
Special Rule for Petroleum Class B:
Petroleum Class B (a specific type of petroleum) can be sent to someone without a storage licence, but only up to 15,000 litres if it's in sealed airtight containers that are approved.
The person sending it must make sure the recipient has made arrangements to dispose of the petroleum immediately, especially for amounts over 2,500 litres.
If the shipment exceeds 2,500 litres, a dry chemical fire extinguisher must also be included to fight fires in case of an emergency.
Exceptions:
These rules do not apply to deliveries or shipments made to:
The Defence Forces of India.
The delivery of kerosene (Petroleum Class B) to someone who holds a special licence for transferring it into smaller containers (called decantation).
For kerosene, the person delivering it must ensure that the recipient can immediately transfer the kerosene into containers of 2,500 litres or less.
This rule helps regulate how petroleum is handled, ensuring safety and compliance with licensing requirements.
4. Approval of Containers:
Container Requirements:
Containers holding more than 1 litre of Petroleum Class A or more than 5 litres of Petroleum Class B or C must be of a type that is approved by the Chief Controller of Explosives.
Application for Approval:
If someone wants to use a type of container that has not been approved before, they must:
Submit an application with drawings of the container design (to scale).
Include details about the materials, construction method, and capacity of the container.
Provide two sample containers and pay a fee of 1,000 rupees for review by the Chief Controller.
Exceptions:
These approval rules do not apply to containers owned by the Defence Forces of India.
5. Containers for Petroleum Class A:
Materials for Containers:
Containers for Petroleum Class A must be made of materials like tinned, galvanized, or rust-proofed sheet iron or steel. These must be approved by the Chief Controller.
Glass bottles (with a capacity of 2.5 litres or less) can be used for laboratory chemicals that are classified as Petroleum Class A, if they are approved by the Chief Controller.
Container Durability:
Containers must be made and secured properly so that they do not become defective, leaky, or insecure during transit unless there is gross negligence or an extraordinary accident.
The containers should be kept in good repair at all times.
Filling Apertures:
Containers should have a well-made filling opening that is tightly secured with airtight screw plugs, screw caps, or other reliable caps.
Container Metal Thickness:
Containers made of sheet iron or steel must have a certain minimum metal thickness depending on their capacity. The required thickness is:
Up to 10 litres: 0.443 mm (27 BG)
10 to 25 litres: 0.63 mm (24 BG)
25 to 50 litres: 0.80 mm (22 BG)
50 to 200 litres: 1.25 mm (18 BG)
200 to 300 litres: 1.59 mm (16 BG)
Maximum Capacity:
Containers should not exceed a capacity of 300 litres, unless they are specifically approved by the Chief Controller for certain uses.
Air Space in Containers:
Each container must have an air space that is at least 5% of its total capacity.
Warning Labels:
Every container must have a clear warning label in large letters, indicating it contains Petrol or Motor Spirit, or another equivalent warning to show that the petroleum is highly inflammable.
Exceptions:
The rules for container materials, thickness, capacity, air space, and warning labels do not apply to containers owned by the Defence Forces of India.
6. Containers for Petroleum Class B and Class C:
Container Materials:
Containers for Petroleum Class B and Class C must be made of steel or iron and must be approved by the Chief Controller.
Air Space Requirement:
Containers for Petroleum Class B must have at least 5% air space of the total container capacity.
Containers for Petroleum Class C must have at least 3% air space of the total container capacity.
Exceptions:
These rules do not apply to containers owned by the Defence Forces of India.
7. Empty Receptacles:
Empty tanks or containers that previously held Petroleum Class A or Class B must be securely closed unless they are being opened for cleaning or filling.
These containers must be thoroughly cleaned and freed from petroleum vapour before being reused or disposed of.
8. Repairs to Receptacles:
Repairs by Hot Work:
No tank or container that has contained petroleum should be repaired using hot work (e.g., welding, cutting, etc.) unless:
The container has been thoroughly cleaned and is free of petroleum and petroleum vapour.
It has been certified in writing by a competent person as safe for such repair work.
Certificate for Repairs:
The repair certificate must be kept by the repairer for at least three months and must be shown to an inspector if requested.
9. Prevention of Escape of Petroleum:
Precautions must always be taken to prevent petroleum from escaping into:
Drains, sewers, harbours, rivers, or watercourses.
Public roads, railway lines, or any other place where petroleum could cause a hazard.
10. Prohibition of Employment of Children and Intoxicated Persons:
Children under 18 and intoxicated persons are not allowed to be employed in any of the following:
Loading, unloading, or transporting petroleum.
Working in any premises licensed under these rules.
11. Prohibition of Smoking, Fires, and Lights:
Smoking, the use of matches, or anything that could cause ignition (like fires or lights) is strictly prohibited near places where petroleum is:
Refined, stored, or handled.
Transported in a vehicle or vessel.
12. Special Precautions Against Accidents:
Prevention of Fire or Explosion:
No one should do anything that could cause a fire or explosion in any place where petroleum is:
Refined, stored, or handled.
Transported in vehicles or vessels.
Responsibilities of Petroleum Handlers:
Everyone who stores, handles, or transports petroleum must:
Follow the rules and the conditions of any licence they have.
Take all precautions to prevent accidents, especially fire or explosions.
Ensure that no one commits any act that could cause such accidents (as described above).
13. Payment of Fees:
Fees to the Chief Controller:
All fees paid to the Chief Controller of Explosives must be paid through a crossed bank draft:
The draft should be drawn in favour of the Chief Controller of Explosives, Nagpur.
The bank draft must be from any nationalized bank and payable at Nagpur.
Fees up to ₹100 can also be paid in cash at the office of the Chief Controller.
Fees to a Controller:
Fees payable to a Controller (other than the Chief Controller) must be paid via a crossed bank draft drawn in favour of the Controller, payable at the station where the Controller's office is located.
Fees up to ₹100 can also be paid in cash at the Controller's office.
Fees to District Authority or Other Authorities:
Fees to District Authorities or other relevant authorities should be paid in the manner specified by the respective authority.
Refund of Fees:
If an application for a licence is rejected, the fees paid will be refunded:
By the licensing authority if the fee was paid in cash or by a bank draft.
If the fee was paid to a treasury, it will be refunded by the treasury based on an order from the licensing authority.
The refund should generally happen within six months after the payment.
Non-refundable Fees:
Fees paid for purposes other than the grant, renewal, or amendment of a licence are non-refundable.
CHAPTER II IMPORTATION OF PETROLEUM:
14. Licence for Import of Petroleum:
Import Requirement:
Petroleum, except the types that can be stored without a licence (as per sections 7, 8, and 9 of the Act), cannot be imported into India without a licence under these rules.
Exception:
If someone does not have a licence, they can still import petroleum products, but only if they have already made proper arrangements to receive and store the imported petroleum at licensed premises.
15. Petroleum Exempted:
Ship’s Stores:
The rules do not apply to petroleum Class B or Class C that is part of a ship’s stores, if it is manifests (declared) as such.
Petroleum for Defence Forces:
The rules in Sections 14, 19, and 26 do not apply to petroleum imported by the Defence Forces of the Union.
25. Petroleum to be Imported by Land Only at Authorized Places:
Restriction:
No petroleum shall be imported into India by land unless it is brought in through places specifically authorized for this purpose by the Central Government.
26. Declaration, Certificate, and Licence to be Furnished for Importing Petroleum by Land:
Requirements for Importing Petroleum:
Anyone wishing to import petroleum by land must provide the Commissioner of Customs with:
(a) A declaration in Form I, signed by the person or their agent.
(b) A certificate of storage accommodation in Form II, signed by the person or their agent.
(c) The licence or an authenticated copy of the licence for the importation and storage of the petroleum.
Exemptions:
These rules do not apply to petroleum that is exempt under sections 7, 8, and 9 of the Act.
Petroleum Class C imported in bulk in quantities exempted under section 7 does not require a licence under these rules.
27. Permission of the Commissioner of Customs to Unload Petroleum:
Unloading Permission:
Petroleum cannot be unloaded without permission from the Commissioner of Customs.
Conditions for Unloading:
The Commissioner of Customs will permit unloading after reviewing:
(a) The testing officer’s report on the petroleum.
(b) The storage certificate (Form II), if needed.
(c) The import licence, if required.
After these checks and any other inquiries, the Commissioner deems necessary, if everything is in order, permission to unload will be granted.
Exemption for Immediate Export:
If the Commissioner of Customs is satisfied that the imported petroleum is intended to be exported immediately after unloading, he may waive the requirements of rules 14 and 26.
In such cases, the petroleum can be unloaded for immediate dispatch to a place outside India, subject to conditions set by the Commissioner.
Other Powers:
This rule does not affect the Commissioner of Customs' power to detain petroleum under any other laws or rules currently in force.
CHAPTER III TRANSPORT OF PETROLEUM
28. Restriction on Leaky Receptacles:
Rule:
No leaky tank or container that contains petroleum is allowed to be tendered for transport.
29. Loading of Containers:
Rule:
Barrels, drums, and other containers filled with petroleum must be loaded with the bung (cap) facing upwards.
30. Restriction on Passengers, Combustible and Inflammable Cargo:
Rule:
Except as specified in rules 38, 39, and 52, and clause (b) of rule 60, no ship, vessel, or vehicle should carry petroleum Class A, petroleum Class B, or petroleum Class C in bulk if it is also carrying:
Passengers, or
Combustible cargo other than petroleum.
Exception:
This rule does not prohibit the use of dunnage (packing material) in the case of coastwise transport of petroleum Class A, if it is not being carried in bulk.
31. Prohibition of Smoking, Fires, Lights:
Rule:
No person involved in loading, unloading, or transporting petroleum is allowed to smoke or carry items that could cause ignition, such as:
Matches,
Lighters,
Any other appliances capable of producing ignition or explosion.
32. Restriction on Loading and Unloading by Night:
Rule:
Petroleum should not be loaded or unloaded from any ship, vessel, or vehicle between sunset and sunrise, unless:
(a) Adequate electric lighting is provided at the loading or unloading area, and all provisions in Chapter IV are followed.
(b) Adequate fire-fighting facilities and personnel are ready at the loading area to handle any emergencies in case of a fire.
Exceptions:
This rule does not apply to the refuelling of aircraft by vessels or vehicles licensed under these rules by the Indian Aircraft Rules, 1937, or to refuelling by the Defence Forces of the Union.
Explanation:
The Chief Controller will determine if the electric lighting and fire-fighting facilities are adequate or not.
PART – IV TRANSPORT ON LAND BY VEHICLES
62. Application:
This part applies to the transport of petroleum on land by vehicles, but exemptions apply for:
Petroleum Class A in quantities of 100 liters or less.
Petroleum of any class transported other than in bulk (subject to rule 67).
Petroleum transported by the Defence Forces of the Union.
63. Tank Vehicles:
Vehicle Requirements:
Every tank vehicle used for transporting petroleum in bulk must be built, tested, and maintained as per the requirements in the Third Schedule and must be approved by the Chief Controller.
In exceptional cases, the Chief Controller may waive some of these requirements, especially for testing better quality vehicles to improve safety for petroleum transportation on Indian roads.
Tank Fabrication and Approval:
Tanks must be fabricated and mounted on the vehicle by an approved manufacturer. The manufacturer must apply for approval with details about their facilities and competent personnel, along with a scrutiny fee of ₹500.
The manufacturer must submit tank fabrication drawings in quadruplicate (4 copies) for approval, along with a scrutiny fee of ₹100. The approval is valid for 3 years and can be renewed for another 3 years with a fee of ₹500.
Approval Process:
If the Chief Controller is satisfied after reviewing the drawings and conducting any necessary inquiries, they will approve the tank design and return one copy of the approved drawings to the manufacturer.
Exemption for Tank Wagons:
These rules do not apply to tank wagons used for transporting petroleum by rail.
64. Tank Capacity:
Tank Definition:
"Tank" includes any number of tanks on the same vehicle chassis. The specified capacity applies to varying temperatures.
Net Carrying Capacity:
The net carrying capacity (the amount of petroleum it can actually carry) of a tank is:
97% of the gross capacity for Petroleum Class A and Class B.
98% of the gross capacity for Petroleum Class C.
Capacity Limits for Tank Vehicles:
Tank trucks or semi-trailers can carry:
Up to 25 kilolitres of petroleum (except aircraft refuellers).
Aircraft refuellers can carry up to 50 kilolitres of petroleum.
Tank trailers can carry up to 5 kilolitres of petroleum.
Weight Limits:
The maximum safe weight of petroleum carried in a tank vehicle is the difference between the unladen weight of the vehicle and the maximum gross weight allowed under transport regulations.
65. Restriction on Other Use:
A tank vehicle meant specifically for transporting petroleum in bulk cannot be used for any other purpose unless explicitly authorized by the Chief Controller in writing.
66. Trailers:
Restrictions on Tank Trailers:
A tank trailer that is not exclusively used for transporting petroleum cannot be attached to any vehicle for transporting petroleum.
A tank trailer transporting petroleum can only be attached to a vehicle that is exclusively used for transporting petroleum. Moreover, only one trailer can be attached at a time.
A tank trailer cannot be attached to a tank semi-trailer or any other trailer.
Braking Requirements:
A tank trailer or tank semi-trailer must have reliable brakes that can be operated efficiently from the driver’s seat of the towing vehicle.
Size and Design Requirements:
The width of the tank trailer or tank semi-trailer must be less than the overall width of the towing vehicle.
The tank trailer must be connected to the towing vehicle in such a way that it follows the path of the towing vehicle and prevents dangerous swerving or whipping.
Transport of Different Petroleum Classes:
If a tank trailer carrying Petroleum Class A is attached to a vehicle carrying Petroleum Class B or Class C, the towing vehicle must meet the requirements for transporting Petroleum Class A.
Other Restrictions:
A trailer that is not a tank trailer cannot be attached to a tank truck.
When a tank trailer is attached to a tank truck, the total quantity of petroleum being transported by both the tank truck and tank trailer cannot exceed 15 kilolitres.
A tank trailer cannot be attached to a tank truck with a net carrying capacity greater than 12 kilolitres.
No tank trailer can be used in thickly populated areas unless the district authority grants written permission.
67. Vehicle for Transport Otherwise than in Bulk:
Vehicle Construction:
Every vehicle used to transport petroleum other than in bulk (e.g., in containers) must be strongly constructed with adequate sides and back.
In animal-drawn vehicles, push carts, and pedal carts, the requirements for sides and back do not apply, as long as the load is securely fastened to the vehicle.
Packaging and Projection:
All containers of petroleum must be packed in such a way that they do not project beyond the sides or back of the vehicle.
Restrictions on Transporting Petroleum Class A:
Petroleum Class A cannot be transported in trailers attached to any vehicle.
68. Composite Vehicles:
Petroleum in cans or containers cannot be transported on a tank vehicle used for transporting petroleum, unless the vehicle complies with both:
Rules for the transport of petroleum otherwise than in bulk, and
Rules for the transport of petroleum in bulk.
69. Carriage of Other Articles Prohibited:
No vehicle transporting petroleum can carry any other article at the same time, unless explicitly authorized in writing by the Chief Controller.
70. Engines of Mechanically Propelled Vehicles:
Engine Requirements:
Vehicles used for transporting petroleum (other than Petroleum Class B and Class C otherwise than in bulk) must have:
Diesel engines or internal combustion engines.
Exhaust systems that are positioned in front of the tank or load and clear from fuel systems and combustible materials. The exhaust should also be protected from fuel spills and grease accumulation.
The exhaust pipe must be fitted with an approved spark arrestor.
The muffler or silencer must not be removed or tampered with.
Air intake systems must have effective flame arresters to prevent flames from the engine in case of backfires.
The vehicle cab must be all-metal and have wired glass windows. Alternatively, the cab and engine must be separated from the tank/load by a fire-resisting shield.
Fuel Tank Safety:
If the fuel tank is installed behind the vehicle cab, it must:
Be designed and installed safely to prevent hazards.
Be protected by steel guards and have a locked filling cap.
Quick Action Cut-off Valve:
Vehicles running on Petroleum Class A must have a quick action cut-off valve on the fuel feed pipe, which should be easily accessible and clearly marked.
Exemption for Helicopters and Airplanes:
The engine requirements (except for the exhaust and spark arrestor provisions) do not apply to helicopters or airplanes used exclusively for aerial crop-spraying with Petroleum Class A.
71. Electrical Installation:
Rule: If electrical equipment is used on a vehicle (including trailers) for transporting petroleum (other than petroleum Class C), the following precautions must be taken:
Voltage Limit:
The pressure of the electric circuit must not exceed 24 volts.
Electrical Wiring:
Insulation: Wiring must be heavily insulated and capable of handling maximum loads.
Over-current Protection: The circuit should have fuses or automatic circuit breakers to prevent overloading, and the wiring should be installed in a way that avoids physical damage or contact with spilled petroleum (e.g., using metal conduit or other oil-resistant protective coverings).
Sealed Junction Boxes: All electrical junction boxes must be sealed.
Location of Electrical Components:
Electrical components such as the generator, battery, switches, and fuses must be located in the vehicle's cab or engine compartment.
The battery should be easily accessible, with a heavy-duty switch nearby to cut off power when necessary.
Flame-proof Equipment:
Any generators, motors, or switches installed outside the engine compartment must be of the approved flame-proof type.
Air circulation must be provided if electrical equipment is placed in an enclosed space to prevent overheating and accumulation of flammable vapors.
Exceptions:
The above rules do not apply to the transportation of petroleum Class A for helicopters and airplanes used for aerial crop spraying, provided the petroleum is not transported in bulk.
72. Means of Extinguishing Fire:
Rule: Every vehicle transporting petroleum by road must carry the following fire extinguishing equipment:
Portable Fire Extinguisher:
A 10 kg dry chemical powder fire extinguisher (or equivalent) suitable for petroleum fires must be easily accessible and removable.
Driver's Cabin Fire Extinguisher:
A smaller 1 kg dry chemical powder fire extinguisher must be kept in the driver's cabin of the vehicle.
73. Vehicles to be Constantly Attended:
Rule: Every vehicle transporting petroleum by road must have at least one person always attending to it, except under specific conditions:
General Requirement:
The vehicle must always have at least one person who is familiar with the safety rules for transporting petroleum.
Exception for Empty Tanks:
If the vehicle’s tanks or compartments are empty but still contain petroleum vapors, the vehicle can be left unattended at approved locations (as authorized in writing by the Chief Controller).
Special Requirement for Larger Loads:
For vehicles carrying more than 5 kilolitres of petroleum (other than Class C) or vehicles that are being trailed by another vehicle, there must be two persons attending the vehicle while it is in motion. Both individuals must be familiar with the transportation rules.
74. Prohibition on Parking:
Rule: Vehicles transporting petroleum by road must not park:
On any public road or in congested areas.
Within 9 meters of any source of fire.
CHAPTER V - STORAGE OF PETROLEUM REQUIRING LICNECE
116. Licence for Storage:
You cannot store petroleum unless you have a licence, unless it's for:
Petroleum stored in well-head tanks.
Petroleum stored as transit cargo in a port, but only if approved by the port authority.
117. Fire Safety:
No Smoking: You can’t smoke in any storage area or service station unless the licensing authority has specifically allowed it.
No Matches or Dangerous Items: Don’t carry matches, fuses, or anything that could cause a fire or explosion in storage areas.
No Open Flames or Heat Sources: You can't have fire, furnaces, or anything that could ignite flammable vapours in storage areas unless authorized.
Fire Extinguishers:
Keep enough fire extinguishers that can put out oil fires at key points in storage areas and small installations.
Everyone working in these areas should know how to use the fire extinguishers.
Installations should follow the fire-fighting requirements in the OISD Standard-117 (for newer installations). For older installations, fire safety should be improved as much as possible according to this standard, with approval from the Chief Controller.
118. Supervision of Operations:
All work in the storage or service areas must be supervised by someone experienced and knowledgeable about the rules and safety standards, and who has proper safety training.
119. Cleanliness:
The ground inside and around the storage or service station must be kept clean and free from plants, waste, or rubbish.
120. Drainage:
Proper Drainage: There must be good drainage around tanks so that water doesn’t collect in the area.
Level of Enclosure: The walls or enclosures around the tanks must not be below the surrounding ground level.
Drainage Pipe with Valve: If there is a drainage pipe, it must have a valve that can be operated from outside the enclosure.
Keep Valves Closed: Valves and openings for drainage should be closed when not in use.
Drainage Plan: You need to show the drainage system in the plan you submit when applying for a licence.
121. Preventing Unauthorized Access:
The area around every storage installation or shed must be enclosed by a wall or fence that is at least 1.8 meters high.
For service stations, the fence or wall on all sides (except where vehicles drive in) must be at least 1.2 meters high.
Steps must be taken to prevent unauthorized people from entering the storage or installation areas.
122. Storage of Petroleum Only:
You can’t use an installation, service station, or storage shed for anything other than storing and distributing petroleum unless you get written permission from the Chief Controller.
123. Tank Capacity Marking:
The capacity (in liters or kiloliters) of every above-ground tank must be clearly marked on the tank.
124. Construction of Tanks:
Tanks for storing petroleum (except well-head tanks) must be made of iron or steel, following the standards set by the Indian Standards Institution (ISI) or another approved code. If needed, tanks can be made from other materials.
The tanks must be placed on strong foundations or supports made of non-combustible material, following good engineering practices.
The height of a tank should not be more than 1.5 times its diameter, or 20 meters—whichever is less.
There must be an air space in each tank that is at least 5% of its total capacity, or as prescribed by the approved code—whichever is smaller.
125. Protection Against Corrosion:
Tanks (other than well-head tanks) that are installed on or below the ground must be protected against corrosion. This can be done by using special coatings, cathodic protection, or other methods approved by the licensing authority.
126. Testing of Tanks:
After a storage tank is installed, re-installed, or repaired, it must be tested for leaks using water pressure before it can be used. This test must be done by a qualified person.
The water used for the test must not contain any petroleum and should not be pumped through the same pipes or pumps used for petroleum (unless the licensing authority gives special permission).
The person conducting the test must issue a certificate confirming the test results. This certificate must be submitted to the licensing authority when applying for or updating the licence, or after any major repairs.
CHAPTER VII LICENCES
141. Grant of Licence:
Licenses under these rules are granted by the authorities listed in the First Schedule. You will need to apply using the forms specified and pay the required fee.
142. Duration of Licences:
Licences for certain purposes (like those in Form III or Form XVII) can be granted for up to one year, depending on what the licensing authority decides.
Other licences are generally granted for a period up to the 31st of December of the year they are issued or renewed, with a maximum duration of three years.
If the licence is needed for a specific work or a short-term event (like a festival), the licensing authority can issue it for a shorter period, even if it doesn’t last until the end of the year.
143. Application for Licence:
To get or renew a licence, you must submit a written application to the relevant authority.
For specific purposes like transporting petroleum in bulk or storing petroleum, there are different application forms:
Form VII: For transporting petroleum by road.
Form VIII: For transporting petroleum (Class A/B) for fuelling aircraft, heavy machinery, etc.
Form IX: For importing and storing petroleum.
Form X: For decanting kerosene from vehicles.
144. No-objection Certificate (NOC):
If the Chief Controller or Controller is the licensing authority, and you’re applying for a new licence (except for certain specified forms), you must first apply to the District Authority for a certificate stating that there is no objection to issuing the licence for the site.
You need to submit two copies of the site plan showing the location of the premises.
If the District Authority agrees, they will grant you the certificate, which you then send to the licensing authority with your application.
The certificate must include a copy of the site plan with the District Authority’s official seal.
If you don’t have this certificate, the Chief Controller or Controller can refer your application back to the District Authority for further review.
If the District Authority objects to issuing the licence, the Chief Controller or Controller will not issue the licence without approval from the Central Government.
The District Authority must process the NOC request within three months of receiving the application.
145. Licence Details:
Licence Conditions: Every licence granted under these rules comes with specific conditions, which you must follow. The licence will also include all the details required by the appropriate form.
Plan of Licensed Premises:
A copy of the plan(s) showing the layout of the licensed premises must be attached to the licence. This plan must be signed by the licensing authority to show their approval.
This plan becomes part of the licence.
An identical copy of the approved plan must also be kept on file at the licensing authority’s office for record-keeping.
Exception: This rule does not apply to licences in Form XVIII.
146. Approval Needed for Changes to Licensed Premises:
No Changes Without Approval: You cannot make any changes to your licensed premises (e.g., storage or service area) unless you get prior approval from the licensing authority.
How to Apply for Changes:
Submit three copies of a detailed plan showing the proposed changes. Use different colors to highlight the changes and explain why you need them.
Pay a fee of ₹400 for the review of your proposed changes.
Approval Process:
The licensing authority will review the plan and may visit the premises if needed. If they approve the changes, they will return one copy of the plan, signed by them, with any conditions for the changes.
Amending the Licence: After the approved changes are made, you must apply to amend the licence to reflect the changes.
147. Amending the Licence:
Licence Amendment: The licensing authority can amend your licence when needed.
Fee for Amendment: The fee for amending a licence is ₹500, plus any difference between the original fee and the fee for the amended licence (if the amended licence requires a higher fee).
How to Apply for an Amendment:
Submit a completed application form (Form VII, VIII, IX, or X) depending on the type of licence.
Attach the original licence with approved plans.
If changes were made to the premises, include three copies of the revised plan showing the approved changes.
Pay the amendment fee.
If applicable, submit certificates for tank testing or safety (as required by rules).
148. Renewal of Licence:
Renewal Process: A licence can be renewed by the authority that granted it. If the licence was granted by the Chief Controller, it can be renewed by a Controller authorized by the Chief Controller without any changes.
Licence Duration for Renewal: Most licences (except those in Form III or Form XVII) can be renewed for up to three years if the licensee has followed the rules and conditions during the previous period.
Refund for Early Surrender: If a licence renewed for more than a year is surrendered before it expires, the licensee can get a refund for the unused portion of the renewal fee. However, no refund will be given for:
The year when the licensing authority receives the surrendered licence, or
Any period during which petroleum was received or stored under the licence.
Application for Renewal: To renew the licence, the licensee must:
Submit the renewal application in the appropriate form (Form VII, VIII, IX, or X).
Provide the existing licence, approved plans, and pay the renewal fee.
Submission Deadline: The application for renewal must be submitted at least 30 days before the licence expires. If submitted on time, the licence will be considered valid until the renewal is granted or refused.
Refund for Refused Renewal: If the licence renewal is refused, the renewal fee will be refunded after deducting the fee for the period the licence was to be renewed until the refusal date.
Late Renewal Fee:
If the renewal application is submitted late (but within 30 days after expiry), the renewal fee will be doubled.
If applying for renewal for more than one year, the late fee applies only for the first year of renewal.
No Renewal After 30 Days: If the renewal application is submitted more than 30 days after the expiry date, the licence will not be renewed.
149. Refusal of No-Objection Certificate (NOC):
If the district authority refuses to issue a No-Objection Certificate (NOC), they must give a written explanation for the refusal. The applicant must also be given a chance to present their case before the refusal.
150. Cancellation of No-Objection Certificate (NOC):
When NOC Can Be Cancelled: A NOC can be cancelled if the district authority or state government determines that the licensee no longer has the right to use the site for storing petroleum.
Process for Cancellation: Before canceling a NOC, the licensee must be given a chance to explain. If canceled, the authority must provide written reasons and immediately send a copy of the cancellation order to the licensee and the licensing authority.
151. Refusal of Licence:
If the licensing authority refuses to grant, amend, renew, or transfer a licence, they must provide written reasons for the refusal.
152. Suspension and Cancellation of Licence:
Reasons for Licence Cancellation or Suspension:
Ceasing Rights to the Site: The licence will be cancelled if the licensee no longer has the right to use the site for storing petroleum.
No-Objection Certificate (NOC) Cancellation: If the NOC is cancelled by the District Authority or the State Government, the licence is also cancelled.
Violation of Laws or Licence Conditions: The licence can be suspended or cancelled by the licensing authority if the licensee violates the Petroleum Act, rules, or the licence conditions. It can also be cancelled by the Central Government if it finds sufficient reasons.
Suspension Procedure:
The licensee must be given a chance to explain (be heard) before their licence is suspended or cancelled, unless:
The violation is immediate and serious (e.g., public danger), in which case the licence can be suspended temporarily without giving the licensee a chance to be heard. A hearing must still be given before confirming the suspension.
The Central Government suspends or cancels the licence in the public interest or for national security, and it decides that giving the licensee a chance to be heard is not necessary.
Written Reasons: Any authority suspending or cancelling a licence must give written reasons for their decision.
153. Procedure on Expiration, Suspension, or Cancellation of Licence:
Notification and Disposal of Petroleum:
If a licence expires, is suspended, or is cancelled, the licensee must notify the District Authority about the type and amount of petroleum in their possession. They must also follow any directions given by the District Authority about how to dispose of the petroleum.
Temporary Licence:
A temporary licence can be granted for up to three months after a licence expires, is suspended, or is cancelled. This temporary licence is only for the petroleum that was already in storage at the time the original licence expired or was cancelled.
If the original licence was granted by an authority other than the District Authority, the District Authority must get approval from the original authority before issuing a temporary licence.
Temporary Licence Fee: The fee for the temporary licence will be proportionate to the time it is valid, compared to the full yearly fee of the original licence.
154. Appeals:
Appeals Process:
If a licence is refused, amended, renewed, suspended, or cancelled, the decision can be appealed:
To the Central Government: If the Chief Controller made the decision.
To the Chief Controller: If a Controller made the decision.
To the official superior of the District Authority: If the District Authority made the decision.
To the official superior of the officer who manages vessels carrying petroleum: If the decision relates to vessels.
Appeal Against NOC Cancellation: If a District Authority cancels a No-Objection Certificate (NOC), the appeal goes to the authority directly above the District Authority.
Appeal Submission:
The appeal must be made in writing and should be submitted within 60 days of the order.
The appeal must include a copy of the order being appealed.
155. Supply of Rules:
When a licence is granted for the storage of petroleum, the licensee will receive an extract of important rules, free of charge. These rules cover:
Rules related to general conditions (Rules 3-12).
Safety, storage, and operational procedures (Rules 102-134).
Rules regarding alterations, renewals, and appeals (Rules 146-159).
156. Transfer of Licence for Storage:
Application for Transfer:
A licensee can apply to transfer their petroleum storage licence to another person before it expires.
Documents Required for Transfer:
A letter from the current licensee, stating the full name and address of the person to whom the licence is being transferred.
An application (Form IX) filled out and signed by the person to whom the licence is being transferred.
A fee of ₹500.
Approval of Transfer:
Once the licensing authority receives the application and fee, if they approve the transfer, they will add an endorsement on the licence, stating that it has been transferred to the new person.
Rights and Obligations:
The person receiving the licence will have the same rights and responsibilities as the original licensee under the terms of the licence.
157. Procedure on Death or Disability of Licensee:
During Disability or Death:
If the licensee dies, becomes insolvent, mentally incapable, or is otherwise disabled, the person continuing the business is not liable for penalties or confiscation for using the licence. This grace period is allowed while they apply for a new licence for the unexpired portion of the original licence.
Application for New Licence:
The person taking over must apply for a new licence for the unexpired portion of the original licence and submit a no-objection certificate (NOC) from the District Authority.
Fee for New Licence:
A fee of ₹200 is charged for the new licence for the remaining period of the original licence.
158. Loss of Licence:
If the original licence is lost or destroyed, the licensee can apply for a duplicate licence. To do this, they must submit a copy of the original plan(s) and pay a fee of ₹200.
159. Production of Licence on Demand:
Showing Licence:
A person holding a licence must produce the licence (or an authenticated copy) when asked by an Inspector at the licensed premises.
Authenticating Copies:
Copies of a licence can be authenticated by the authority that issued it:
A fee of ₹50 is charged for each authenticated copy.
The original plans (or copies identical to the approved plans) must also be submitted.
160. Procedure on Reports of Infringement:
If there is a report of an infringement of the Petroleum Act or these rules, the District Authority must inform the Chief Controller about the actions they have taken regarding the infringement.
161. Executive Control Over Authorities:
All authorities (other than the Central Government) acting under this chapter must perform their duties under the control of the Central Government.
However, this does not affect the Chief Controller's executive control over subordinate officers.
THE END