NTPC moves SC against Bombay HC order

NEW DELHI: NTPC on Saturady moved the Supreme Court seeking quashing of the Bombay high court order giving permission to the Mukesh Ambani’sReliance Industries Ltd (RIL) to amend its plea in its on-going dispute with the country’s largest utility on the supply of gas from the Krishna-Godavari basin.

"It is submitted that the amendment in effect seeks to portray the Central government as the chief architect of the inability of RIL in being able to perform GSPA (Gas Sale&Purchase Agreement) and having impliedly taken away the foundational basis of a very carefully structured bid and suggests that on this basis that the GSPA is one which is incapable of performance. This it is submitted is an entirely new case and ought not to have been permitted to be urged for the first time by way of a written statement", said NTPC in its Special Leave Petition (SLP).

It further said, "the subject matter of disputes between petitioner (NTPC) and the Respondent (RIL) was under a global tender invited by the petitioner for supply of gas and was not as per any directive of the Central government".

RIL had arrived at an agreement with the NTPC to supply 12 million standard cubic metres per day (mmscmd) gas at US$ 2.34 per million British thermal unit (mmBtu) pusuant to the global competitive bidding.

However, the RIL sought to wrigle out and avoid the GSPA on the one pretext or the other, had compelled NTPC to move Bombay high court for enforcement of its agreement with the contractor RIL. The Chirman of RIL Mr Mukesh Ambani in his letter dated June 22, 2004 thanked the then chairman of NTPC for selecting RIL, said state owned utility in its SLP.

RIL had filed its written statement on Jan 31, 2007 before the high court in the case. The issues were framed on Oct 6, 2008 and the evidence have been commenced. But the order of the Division bench of the high court passed on July 30 upholding the order of the single judge bench of the high court allowing the application of RIL to amend its written statement in the case is illegal, said NTPC.

Mukesh Amani’s firm had amended its written statement taking advantage of an affidavit filed by the oil ministry in the high court for a separate case (RIL vs RNRL). The government affidavit, filed on January13, 2009 but later withdrawn had stated that price of KG basin gas was fixed at $4.20 mBtu by an empowered group of ministers (EGoM).

NTPC seeking direction of the apex court to restrain RIL from amending its written statement said, the EGoM in its first meeting held on Sep 12, 2007 had expressly stated that the "decision taken in this EGoM meeting will be without prejudice to the NTPC vs RIL and RNRL vs RIL case which are separately subjudice".

"The second EGoM decision dated May 28, 2008 was relating to commercial utilization of natural gs under NELP and the third EGoM decision dated Oct 23, 2008 reiterated the decision taken in the first in the first EGoM dated Sep 12, 2007 that regarding NTPC-RIL sale price the verdict of the court(Bombay high court) should be awaied", NPTC said.
NTPC further said in its SLP, "as regards the fourth EGoM dated Jan 8, 2009 though referred to in the proposed amendment by RIL, the same is not on record.

This apart the GSPA (which is not the subject matter of the suit (NPTC vs RIL in high court) relates to supply of gas by the Respondent (RIL) which it would be getting under the Production Sharing Contract dated Feb 14, 2000 between the Union of India and RIL and had the PSC disabled RIL from marketing gas there was no way the RIL would have even offered to supply the gas and submitted its bid".

The petitioner being desirous of expanding the current capacity of its existing gas based power generating plants at Kawas and Jhanor, Gandhar in the state of Gujarat by approximately 2600 MW to meet the power requirements of the state of Gujarat and Maharashtra and the Union Territories of Western India through a global competitive tendering process invited bids for supply of natural gas to its proposed plant expnasions, said NTPC to the apex court.

NTPC further said, ‘grave prejudice and irreparable harm and injury would be caused to the petitioner if the Respondent is allowed to amend its written statement pending the hearing and final disposal of this SLP".