Apex court posts RNRL-RIL dispute for hearing on 20 July
07 Jul 2009
The Supreme Court today issued notices to Reliance Industries (RIL), Reliance Natural Resources Ltd (RNRL) and the government regarding the cross appeals by the two companies over their gas supply dispute. While issuing notices to the parties, a bench of the apex court headed by chief justice KG Balakrishnan posted the matter for hearing on 20 July.
RIL had last week moved the apex court challenging a Bombay High Court order directing the company to supply 28 mmscmd of gas to RNRL at $2.34 per mmbtu. Reliance Industries Ltd, in its appeal had alleged that the court had erred in deciding on three terms – quantity, tenure and price of gas supply – to RNRL affiliates' power plants.
RNRL had also moved the Supreme Court seeking modifications in the Bombay High Court order to make the gas supply from RIL binding.
RIL moved the apex court challenging the Bombay High Court order which asked it to supply gas at a price which is 44 per cent lower than government mandated price of $4.2. It is also about a third of the international price of about $6. The price of natural gas which is mainly used by fertiliser and power companies is fixed by the government.
Reliance Industries Ltd in its appeal has said that the High Court has erred in deciding the three term s -- quantity, tenure and price of gas supply -- to power plants of RNRL affiliates. Reliance Natural Resources Ltd also moved the Supreme Court seeking modification in the Bombay High Court order to make binding the gas supply from RIL.
While Anil Ambani's RNRL wants implementation of the Bombay High Court judgement to avail cheaper gas from RIL, Mukesh's RIL has argued that that this would mean a loss for both the company as well as the government.
Interestingly, the Bombay High Court which asked Mukesh led Reliance Industries to supply gas to RNRL had asked the brothers to go back to their mother in case of failure to reach an agreement on the terms.
