Shares of Indian Oil Corp (IOC) plunged 6 per cent today on reports that

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it will have to pay over Rs 979 crore in unpaid entry tax to the Uttar Pradesh government within two weeks.

Despite good gains in the equity markets, IOC shares dipped to settle 5.81 per cent lower at Rs 271.75 on the BSE.

On the NSE, the stock settled at Rs 271.45, down 6.01 per cent from the previous close.

IOC will have to pay over Rs 979 crore in unpaid entry tax to Uttar Pradesh government in the next two weeks after the Supreme Court asked the company to deposit half of the unpaid liability in cash.

It had challenged in the Allahabad High Court the state government's decision to levy USD 5.78 a barrel on crude oil moved into the state for processing at its 8 million tonne per annum refinery at Mathura.

"The High Court of Allahabad (on December 23, 2011) dismissed IOC's writ petition and upheld the UP Entry Tax Act 2007, whereby the state of Uttar Pradesh was entitled to levy entry tax on crude oil brought into Mathura for refining in the Mathura refinery," IOC said in a filing to the BSE.

The BSE 30-scrip index, Sensex closed 107.03 points higher at 17,300.58.