New Delhi: Government on Wednesday asserted in
the Supreme Court that any suitable arrangement between the
Ambani brothers for the supply of gas from K G Basin has to be
approved by it keeping the national interest paramount.
It said the 2005 family MoU between the Ambani brothers
cannot override the public policy on the gas supply and
utilisation.
Even the Production Sharing Agreement (PSA) between
Mukesh Ambani Group firm RIL and the Government talks about
public interest, Additional Solicitor General Vivek Tankha
submitted before a Bench headed by Chief Justice K G
Balakrishnan.
"The RIL and Anil Ambani's RNRL could arrive at
suitable arrangement but it has to be a suitable arrangement
for the country approved by the government," he said.
"How could their (Ambanis) MoU override public
document which is the PSA. The MoU is a family arrangement
while PSA is an arrangement for the country.
"We are concerned with the protection of natural
resources which is not limited to this case but for for all
times to come. People's right has to be protected," he argued
before the Bench, also comprising Justices B Sudershan Reddy
and P Sathasivam.
However, the government faced tough time as both the
Bench and RNRL questioned its submissions which were
purportedly not part of the record in the Bombay High Court.
"Our simple question is what are the material
available with you on which you are arguing," the Bench asked
the ASG, who said there was nothing on record from
Government's side before the High Court.
However, Tankha said this cannot be a ground to keep
the government away from the dispute as "peoples' right have
to be protected".
"How can the resource of the country be discussed and
decided in the absence of the government," the ASG said.
Tankha was frequently interrupted by RNRL's counsel
Ram Jethmalani and Mukul Rohatgi who accused the Government of
putting forth submissions which were never the part of the
High Court records.
Jethmalani said Government submissions are designed to
"help" RIL and its officials must be ready to face cross-
examination.
Earlier, continuing the arguments Additional Solicitor
General Mohan Parasaran said Government is the sovereign
owner of all natural resources and the Constitution obligates
upon it to distribute it in the best interest to subserve the
common good.
He said the High Court had, on the other hand,
proceeded to conclude that an assured allocation of natural
gas in favour of RNRL exists which results in compelling RIL
to enter into contract with RNRL for the Supply of 28 MMSCMD
in addition to 12 MMSCMD of natural gas in case NTPC contract
does not fructify.
The Ambani brothers are locked in a bitter battle over
the supply and price of the gas from KG basin.
While RNRL is seeking gas at a committed price of USD
2.34 per unit, RIL says it cannot honour the commitment made
in the family agreement due to government's pricing and gas
policies.
Parasaran said Government policy was clear that gas
was its property till it reached the delivery point. In this
case, from the delivery point it would be under the control of
RIL which is assuming the role of a contractor.
He said it was not permissible for the RIL to enter
into contract with RNRL without the express approval of the
Government.
This prompted the Bench to ask the Government whether
it ever objected to the RIL offer to RNRL.
The Bench also wanted to know whether the Empowered
Group of Ministers had fixed the gas price after being
in the know about the contract between RIL and RNRL.
Parasaran said the government had rejected the price
of USD 2.34 mmBtu fixed between RIL and RNRL in 2006.
However, this submission was opposed by Jethmalani,
who said the arguments were contrary to its stand in the High
Court.
"You don't even have the right to approve the price,"
he said opposing the Government stand that any suitable
arrangement between the Ambani brothers will have to be
approved by it.
"There is only one gas utilization policy. I am bound
by that," he said and termed the submissions of government as
"wild arguments".
Bureau Report
First Published: Wednesday, November 18, 2009, 20:47