No favouritism shown towards Reliance: Centre

Petitions, based on a CAG report and by parliamentary committee findings, were inappropriate as several issues raised in these are before arbitrators

The central government on Tuesday told the Supreme Court it had not shown any favour to Reliance Industries in the matter of gas exploration in the Krishna-Godavari Basin or pricing, and the allegations made by Communist Party of India leader Gurudas Dasgupta, in his petition, were unfounded.

Solicitor General Mohan Parasaran was replying to the charges made by the parliamentarian and Common Cause, a public interest organisation, that the government and its oil ministers were closing their eyes to the various irregularities committed by the Mukesh Ambani-led group. During the arguments, he handed over two documents in sealed covers to the judges. They contained status reports on the investigation, conducted by the enforcement directorate and the central board of direct taxes, into the issue of a cash flow of around Rs 6,500 crore from Singapore, on which several questions have been raised. Counsel claimed immunity for the documents from publication.

The petitions, based on a Comptroller and Auditor General report and by parliamentary committee findings, were inappropriate as the several issues raised in these are before arbitrators. The counsel noted that another bench of the court had on Monday nominated the chairman of the arbitration tribunal. Disputes over cost recovery and other issues are going on between the government and the company. Therefore, the public interest suit on pending issues should not be heard by the court, the solicitor general told a bench headed by judge B S Chauhan.

The counsel denied the government was inactive on the breaches committed by Reliance on the terms of the profit-sharing contract. It has issued various notices regarding underutilisation of the exploration and development areas, failure to meet the promised targets, negligence and damage to the oil fields. These were backed up by expert evidence. Therefore, there is no mala fide as alleged in the two petitions, Parasaran said.

He submitted that the government will go into the recovery of cost and other issues after the arbitration tribunal gives its verdict. The members include two retired Chief Justices of India and an Australian jurist, James Spigleman. The arguments of the government will continue on Wednesday.