Judge seeks to recuse herself in Reliance-NTPC case

Justice Roshan Dalvi sought to recuse herself from the case involving Reliance Industries Ltd (RIL) and state-owned National Thermal Power Corporation (NTPC) over the supply of gas from the Krishna-Godavari (KG) basin today.

RIL had applied to the Bombay High Court seeking the appointment of a new judge, legal sources said, on grounds that Justice Dalvi holds four shares in NTPC.

Based on today’s closing price of the NTPC scrip on the Bombay Stock Exchange, the four shares are worth around Rs 685.

RIL was not available for comment on the development despite repeated attempts.

The case stands postponed till the Chief Justice of the Bombay High Court, Swatanter Kumar, appoints a new judge and issues a fresh date of hearing.

NTPC and Mukesh Ambani-promoted RIL have been involved in a legal row in the Bombay High Court since December 2005 over the latter’s claim that it has only signed a Letter of Intent (LoI) with NTPC and does not have a concluded contract with the power company.

NTPC has maintained that it has a concluded contract with RIL for the supply of natural gas to its Kawas and Gandhar power stations in Gujarat.

NTPC had invited the bid in October 2002 and RIL had emerged as the sole successful bidder for supply of natural gas to these projects. RIL had won the right to supply 12 million metric standard cubic metres per day (mmscmd) of gas to NTPC’s power projects in Gujarat at $2.34 per million metric British thermal unit (mmbtu). RIL had quoted the lowest price in 2004 in the bidding process and was subsequently issued an LoI.

NTPC went to court in 2005 after RIL did not sign the gas sale and purchase agreement (GSPA) because of a dispute over a clause relating to unlimited liability.

The resolution of this case is important for another case over the supply KG basin gas involving RIL and Reliance Natural Resources Ltd (RNRL), promoted by Mukesh Ambani’s brother Anil because the RIL-RNRL GSPA was drafted on the lines of the NTPC-RIL agreement.

Meanwhile, in a related development, R S Sharma, chairman and managing director of NTPC, met the Advocate General of Maharashtra, Ravi Kadam, in Mumbai today and briefed him that the government’s counsel in the gas dispute case between RIL and RNRL would withdraw his statement that “NTPC did not have a concluded gas contract with RIL”.

The counsel, Justice TS Doabia, was representing the ministry of petroleum and natural gas. The next hearing for RIL-RNRL case is scheduled for September 1.