The Supreme Court on Monday issued notices to the Centre, RIL and petroleum minister Veerappa Moily and sought their replies on a PIL which alleges conspiracy in the government's decision to double the price of natural gas from April 2014.
Before seeking replies from the respondents within four weeks, a bench of Chief Justice P Sathasivam and Justices Ranjana P Desai and Ranjan Gogoi sought clarifications from Colin Gonsalves — counsel of petitioners MP Gurudas Dasgupta and ex-power secretary E A S Sarma — and heard RIL counsel Harish Salve.
To Salve's preliminary objections, the bench said, "We cannot brush aside the assertions of an MP at the preliminary stage. You (respondents) file your replies and we will consider it." It fixed hearing on the PIL for September 5.
The petitioners alleged that KG basin gas exploring contractors, RIL and NIKO Resources, entered into a conspiracy with the Centre "to provide exorbitant, unreasonable and excessive profits to the contractors, which will bankrupt the exchequer and severely affect the Indian economy".
They sought quashing of the gas price hike and requested the court to direct the government to ensure that henceforth "the price of domestically produced gas is fixed in rupees and not dollars or any other currency".
"Appoint a court commission comprising independent and fearless officers and experts having expertise in the area of this dispute to inquire into the real cost of gas at the well-head in the KG basin and also into the capacity of the basin itself and related issues raised in the petition," they said.
Dasgupta and Sarma also alleged that certain benefits were being granted to the contractors by government for mala fide and collateral gain which would increase the subsidy burden enormously. They also said the gas price hike would "enormously impact" food and energy security resulting in higher prices of fertilizers, food products and cooking gas affecting the poor.
Quoting comptroller and auditor general's report, they sought a direction to RIL and NIKO to "forthwith relinquish those areas of KG basin as recommended by the CAG and delineated by the Director General of Hydrocarbon". Salve said RIL was ready to relinquish these and had already written to the government in this regard.
The petitioners quoted DGH to allege that only 18 wells against the required 50 had been drilled by RIL, which incurred expenditure of $5,693 million but till March 31, 2011 had recovered $5,258 million.
The petitioners said the petroleum ministry on May 2, 2012 issued a notice to RIL informing it that breach of production sharing contract and failure to comply with the approved plan had resulted in heavy loss of production and sought to disallow $1005 million from cumulative cost incurred by the contractor.
They said the matter went to arbitration with RIL appointing Justice SP Bharucha as its arbitrator and government choosing Justice VN Khare. When they were in the process of appointing the third arbitrator, the petroleum minister gave an interview saying he intended to junk arbitration and push for a negotiated settlement.
The petitioners said the arbitration must proceed expeditiously and be completed within six months. But Salve objected to it saying both arbitrators were eminent retired chief justices of the Supreme Court and nothing should be said which would hurt them and the process of arbitration.
Before seeking replies from the respondents within four weeks, a bench of Chief Justice P Sathasivam and Justices Ranjana P Desai and Ranjan Gogoi sought clarifications from Colin Gonsalves — counsel of petitioners MP Gurudas Dasgupta and ex-power secretary E A S Sarma — and heard RIL counsel Harish Salve.
To Salve's preliminary objections, the bench said, "We cannot brush aside the assertions of an MP at the preliminary stage. You (respondents) file your replies and we will consider it." It fixed hearing on the PIL for September 5.
The petitioners alleged that KG basin gas exploring contractors, RIL and NIKO Resources, entered into a conspiracy with the Centre "to provide exorbitant, unreasonable and excessive profits to the contractors, which will bankrupt the exchequer and severely affect the Indian economy".
They sought quashing of the gas price hike and requested the court to direct the government to ensure that henceforth "the price of domestically produced gas is fixed in rupees and not dollars or any other currency".
"Appoint a court commission comprising independent and fearless officers and experts having expertise in the area of this dispute to inquire into the real cost of gas at the well-head in the KG basin and also into the capacity of the basin itself and related issues raised in the petition," they said.
Dasgupta and Sarma also alleged that certain benefits were being granted to the contractors by government for mala fide and collateral gain which would increase the subsidy burden enormously. They also said the gas price hike would "enormously impact" food and energy security resulting in higher prices of fertilizers, food products and cooking gas affecting the poor.
Quoting comptroller and auditor general's report, they sought a direction to RIL and NIKO to "forthwith relinquish those areas of KG basin as recommended by the CAG and delineated by the Director General of Hydrocarbon". Salve said RIL was ready to relinquish these and had already written to the government in this regard.
The petitioners quoted DGH to allege that only 18 wells against the required 50 had been drilled by RIL, which incurred expenditure of $5,693 million but till March 31, 2011 had recovered $5,258 million.
The petitioners said the petroleum ministry on May 2, 2012 issued a notice to RIL informing it that breach of production sharing contract and failure to comply with the approved plan had resulted in heavy loss of production and sought to disallow $1005 million from cumulative cost incurred by the contractor.
They said the matter went to arbitration with RIL appointing Justice SP Bharucha as its arbitrator and government choosing Justice VN Khare. When they were in the process of appointing the third arbitrator, the petroleum minister gave an interview saying he intended to junk arbitration and push for a negotiated settlement.
The petitioners said the arbitration must proceed expeditiously and be completed within six months. But Salve objected to it saying both arbitrators were eminent retired chief justices of the Supreme Court and nothing should be said which would hurt them and the process of arbitration.
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