RNRL's conditional nod for govt as party in gas dispute | business | Hindustan Times
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RNRL's conditional nod for govt as party in gas dispute

RNRL gave its consent in the Supreme Court to the oil ministry becoming a party in the dispute over supply of gas from Reliance Industries Ltd (RIL) but without giving up the right to cross-examine its officials.

business Updated: Nov 19, 2009 16:55 IST

Reliance Natural Resources Ltd (RNRL) on Thursday gave its consent in the Supreme Court to the oil ministry becoming a party in the dispute over supply of gas from Reliance Industries Ltd (RIL) but without giving up the right to cross-examine its officials.

RNRL counsel Ram Jethmalani gave the consent when Solicitor General Gopal Subramanium, appearing for the ministry, sought to remove the perception that "the government was jettisoning" state-run power utility NTPC's interest in another lawsuit with RIL.

"After hearing their brilliant argument, I have decided to allow the government (the oil ministry) to be represented as party, but without giving up our right to cross examine them," Jethmalani said.

"I am consenting not because they have a right to (but) because I want to avoid further litigation by the government," the RNRL counsel told the three-member bench of Chief Justice K.G. Balakrishnan, Justice B. Sudershan Reddy and Justice P. Sathasivam.

Jethmalani also consented to letting the ministry's affidavit to be on the record. RNRL had earlier opposed the ministry bringing in new evidence in the form of affidavits at the hearing in the apex court.

"To cut the matter short, let this affidavit be on the record," said Jethmalani, adding: "We have a compulsory right to cross-examine." The RNRL counsel's nod came amid serious arguments on whether the ministry was making its argument as a party or an intervener.

The court is hearing the dispute over the supply of 28 million units of gas for 17 years at $2.34 per unit to Anil Ambani-led RNRL from the gas fields off the Andhra Pradesh coast, awarded to Mukesh Ambani's RIL.

The price, tenure and quantity were based on a family re-organisation pact of 2005, but RIL subsequently said it could only sell the gas for $4.20 per unit, as this was the price, the company claimed, fixed by the government.

The Bombay High Court had earlier allowed the ministry to become an intervener to assist in interpreting various provisions of the government's production-sharing contract with RIL and on other legal issues. But it had ruled against making the ministry a party.

Minutes before Additional Solicitor General Vivek Tankha was to wind up his argument on behalf of the ministry, Solicitor General Subramanium rose to contradict the perception that the government has jettisoned NTPC's interest in its legal battle with RIL.

"The government in its application has clarified that it has not jettisoned the interest of NTPC. The NTPC suit in the Bombay High Court, seeking supply of gas at $2.34 per unit, should not be prejudiced in any manner," said Subramanium.

Responding to the solicitor general's statement, RIL counsel Harish Salve said that if NTPC proved it has a concluded contract for the gas supply "I am bound to supply the gas at whatever price".

Responding to this, RNRL counsel Mukul Rohatgi said: "I know the solicitor general is a fair person. Till he made the statement, it was the perception that the government believes the price of $2.34 is suspect."

With the government concluding its arguments, Jethmalani opened his on behalf of RNRL.