SC Rejects Ambanis’ Family MoU, Says Fuel Pricing Is Right of Govt
The Supreme Court has dismissed the Ambani family MoU for division of gas, saying that it’s the right of the government to take a decision about the price and utilization of the fuel, which is a national asset, said media reports.
Delivering a verdict on the four-year gas dispute between RIL and RNRL, a bench headed by Chief Justice Chief Justice K G Balakrishnan rejected the MoU, with Justice P Sathasivam saying that the Production Sharing Contract over-rides all other agreements, reports said.
It said that the family agreement – signed among brothers Mukesh and Anil Ambani and their mother Kokilaben – was not legally and technically binding, said reports.
The apex court observed that all parties are bound to abide by government policy and RIL doesn’t become owner of the gas, reports said.
The ruling means that RNRL, which has been seeking 28 mmscmd of gas from RIL’s KG-D6 fields at a price agreed in the family MoU, would not get the fuel.
It may be mentioned that the family MoU provided for a price of $2.34 per mmBtu, while the government had set a price of $4.20 per mmBtu.
The bench said that RIL didn’t enjoy absolute marketing right over gas, that the price was subject to government approval and that the family MoU was not legally binding, said reports.
It said that the terms of production sharing contract would have over-riding effect, and directed RIL to start renegotiation with RNRL in six weeks to safeguard the interests of the Anil Ambani group firm’s shareholders.
Shares of Reliance Industries surged while shares of Anil Ambani owned ADAG group tanked after the Supreme Court announced its verdict in the favour of Reliance Industries.
(Based on internet reports)
