Work out arrangment, end dispute: SC tells Ambani brothers | business | Hindustan Times
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Work out arrangment, end dispute: SC tells Ambani brothers

business Updated: Oct 27, 2009 23:33 IST
HT Correspondent
HT Correspondent
Hindustan Times
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The Supreme Court on Tuesday once again hinted to the Ambani brothers on the possibility of working out a “suitable arrangement” to resolve their gas dispute.

A three-judge bench headed by Chief Justice KG Balakrishnan inquired into the aptness of arbitration process as senior counsels from both sides resumed arguments.

“There are some parameters to arrive at suitable arrangements for supply of gas,” Justice RV Raveendran said. “If you are not able to reach a suitable arrangement... We can direct you to arrive at a suitable arrangement or direct you to go for arbitration.”

Arguing for Mukesh Ambani-managed Reliance Industries Ltd (RIL), as Harish Salve relied on the government’s gas utilisation policy to supply the gas, the bench reminded him that gas was a “natural resource”.

RIL contended that it couldn’t honour the commitment made in the 2005 family agreement between the two brothers due to the government’s pricing and distribution policies. At which, Anil Ambani’s Reliance Natural Resources Ltd (RNRL) senior counsel Ram Jethmalani said the policy was binding on new contracts and not existing ones.

However, Salve continued to draw support from the policy and said it was a better arrangement for the gas supply. He contended that supplying gas at any price lower than what has been fixed by the government would be “suicidal for RIL”.

Jethmalani intervened again, saying “the production tax of gas from KG basin is a meagre 89 cents.” He claimed RIL would make a profit of several thousands of crores of rupees despite selling the gas at $2.34 (Rs 112) per unit.

“It’s fraud on the nation,” Jethmalani said.