SC notice to govt, ONGC over alleged Rs1,00,000-cr loss in Cairn-Vedanta deal
23 April 2012
The Supreme Court today issued notices to the central government, ONGC, Cairn Energy and Vedanta Resources on a petition that seeks criminal investigation into an alleged loss of Rs1,00,000 crore (over $19 billion) to the exchequer in the Cairn-Vedanta deal.
The public interest lawsuit alleges that the government and state-owned ONGC had failed to assert their rights and instead acceded to a Cairn-Vedanta deal that caused huge loss to ONGC and the government.
The PIL, filed by a Bangalore resident, Arun Kumar Agarwal, seeks criminal investigation and scrapping of the Cairn-Vedanta deal that has allegedly caused such a huge loss to the state-run oil explorer.
According to the PIL, the government had erred in giving its approval for Vedanta's acquisition of majority stake in Cairn India. Cairn should have first made the offer first to its Indian partner ONGC, which is entitled to right of first refusal.
According to the PIL, had ONGC, which was Cairn India's joint venture partner, exercised its right of first refusal, the government too would have gained around Rs1,00,000 crore (a little over $19 billion).
A Supreme Court bench comprising Justices DK Jain and Anil R Dave issued notices to the centre, ONGC and Cairn India and sought a reply from them. The petition also seeks audit by the Comptroller and Auditor General (CAG) of India into the deal.