Checked against the Marketing Discipline Guidelines 2024 (Ver. 1, effective 24.10.2024) on 15 October 2026. Published by MDG Services on 17 October 2026.
The limit and what it covers
MDG 2024 lets a normal gap between book stock and dip pass. It judges the rest only after the allowances below are counted MDG 5.1.11. The clause covers MS and HSD. Kerosene dealerships have their own list MDG 8.10: see kerosene dealers.
The allowances you can count
| Allowance | Figure | Counted |
|---|---|---|
| Normal operating variation | 4% of tank stock (Annexure 9 works it on the closing dip) | Yes MDG 5.1.11 MDG Annexure 9 |
| Petrol (MS): evaporation and handling loss | 0.75% of the litres sold, up to a 600 KL annual average; 0.60% on the part beyond | Yes, see the Note MDG 5.1.11 |
| Diesel (HSD): handling loss | 0.25% of the litres sold, up to a 600 KL annual average; 0.20% on the part beyond | Yes, see the Note MDG 5.1.11 |
| Shrinkage allowance and temperature variation allowance (TVA), MS and HSD | A rupee amount per KL, which Annexures 8 and 10 turn into a percentage of the net price | Only where and when it applies MDG 5.1.11 MDG Annexure 8 MDG Annexure 10 |
Read plainly, the higher handling-loss rate covers the first 600 KL and the lower rate only the part above it. For example, with 800 KL of MS sold: 600 x 0.75% + 200 x 0.60% = 4.5 + 1.2 = 5.7 KL. The stock variation calculator runs the whole sum.
Note: MDG leaves two points to your oil company, so confirm both before relying on a figure.
- For a negative variation, the clause words the limit as "up to 4%". It does not say whether handling loss, shrinkage and TVA also count, or how they apply to a positive variation MDG 5.1.11. The calculator sets a gain against the 4% alone.
- It does not say over what period the 600 KL annual average is counted MDG 5.1.11.
When the gap is beyond the limit
MDG does not define "positive" and "negative". In the trade, positive means the tank holds more than the books, and negative means less. A negative variation lets sales continue while the dealer explains, and supply stops if the explanation is not found satisfactory MDG 5.1.11. The positive vs negative page sets the two cases side by side.
Note: a positive variation beyond the limit stops sales of all products at once, before any lab result comes back MDG 5.1.11.
What it costs
| What is found | Class | Action |
|---|---|---|
| Variation beyond the limit, sample passes, nothing else established | Major MDG 8.3(iv) | 1st instance: 15 days' suspension of sales and supplies. 2nd: 30 days. 3rd: termination of the dealership |
| Positive variation, sample fails | Action as for adulteration, critical MDG 5.1.11 MDG 8.2 | Termination at the first instance |
| Positive variation, sample passes but an unauthorised purchase is established | Unauthorised purchase, critical MDG 5.1.6 MDG 8.2 | Termination at the first instance |
The show cause notice page has the timeline after an inspection.
Where to go next
The rupee allowances are explained on the shrinkage and TVA page. The check starts from your morning dips, meter readings and receipts, which the daily stock register covers.
General information, not legal advice. For your own notice, speak to an advocate or your oil company.
Watch the one-minute explainer
In this section
Questions dealers ask
01What is the permissible stock variation, or stock loss, at a petrol pump?
4% of tank stock, plus a handling loss on the litres sold, plus shrinkage and TVA where they apply MDG 5.1.11. In the trade, a stock loss is a negative variation, and the clause words its limit as "up to 4%", so ask your oil company how it counts the other allowances MDG 5.1.11.
02What is stock variation at a petrol pump (stock variation kya hai)?
It is the gap between the fuel your books say a tank holds and the fuel the dip shows. MDG 2024 lets a normal gap pass and treats a gap beyond the permissible limit as an irregularity MDG 5.1.11.
03What happens if stock variation is beyond the permissible limit?
A positive variation (more fuel than the books) stops sales of all products at once, and a negative one lets sales continue while the dealer explains MDG 5.1.11. If the sample passes and nothing else is established, it is a major irregularity: the minimum action is 15 days' suspension, then 30 days, then termination MDG 8.3(iv), and the oil company may take higher action MDG 8.5.1.
04Does the stock variation rule apply to kerosene (SKO) dealers?
Not under clause 5.1.11, which covers MS and HSD only. For SKO-LDO dealerships, MDG 2024 lists a gap between physical and book stock beyond the permissible limit as a critical irregularity and gives no percentage MDG 8.10.
Read the official text: Marketing Discipline Guidelines 2024 (PDF on Bharat Petroleum's website) (also published on iocl.com).
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