When the Bombay High Court convenes this week after the Diwali vacation, the long-drawn legal battle between Mukesh Ambani's Reliance Industries (RIL) and his estranged brother Anil's Reliance Natural Resources (RNRL) could come to an end.
The hearing of the case is in the last leg and the court is likely to pronounce the judgment this month. The case will come up for further hearing on Tuesday.
RNRL is locked in a dispute over terms of a gas supply master agreement with RIL, whereby the latter is to supply gas from its Krishna Godavari reserves to the Anil Ambani company's power projects.
So far, two issues have dominated the arguments— the existence of Memorandum of Understanding (MoU) between the Ambani brothers and whether the central government should be made a party to the case.
The high court division bench comprising Justice J N Patel and K K Tated had last month allowed the Centre to be a party in the case after both the companies said they had no objection to the proposal. RNRL had earlier opposed the government intervention.
The court had in September this year, said it would like to know what the MoU contains as far as the Gas Sale Master Agreement (GSMA) is concerned. Ram Jethmalani, senior counsel for RNRL, had submitted the relevant parts of the agreement (all the terms, including the GSMA) in the court with an affidavit. The GSMA will play an important role in framing the verdict as according to RNRL, the agreement says it is entitled to be supplied 28 million cubic metres of gas per day from the KG basin at a price of $2.34 per million British thermal unit (mBtu) for a period of 17 years.
RIL has refused to supply gas at that price for that period. "The tenure can only be as long as I have the gas," Salve had argued earlier.
Also Read
As per the GSMA, RNRL would also be allotted another 12 million cubic metres of gas if an earlier agreement between RIL and the country's largest power company, NTPC, falls through. Besides, the Reliance Anil Dhirubhai Ambani Group (ADAG) will have the first right of over 40 per cent of all future gas discoveries made by RIL.
RIL and NTPC are embroiled in a legal battle in the high court since December 2005 over the state-owned company's claim that it has only signed a Letter of Intent (LoI) with ADAG and does not have concluded a contract for gas supply. That case too will come up for hearing on Tuesday.