Anil Ambani-led RNRL on Tuesday alleged in the Supreme Court that Mukesh Ambani Group RIL played a “fraud” by coming out with a complex formula on gas pricing to artificially enhance its rate.
Describing the formula submitted by RIL as a “day light robbery”, RNRL contended that gas was to be made available at a reasonable price for the consumption of domestic market.
Senior advocate Ram Jethmalani, appearing for the Anil Ambani Group, said the contract signed between RIL and RNRL envisaged that the gas was to be supplied at $2.34 per unit and government policy on gas utilisation and pricing was not applicable in the dispute.
“The role of the Government is only to undertake the valuation of the gas and not to determine the price. Price is to be determined as per the contract between RIL and RNRL,” he said before a Bench headed by Chief Justice K.G. Balakrishnan.
“The mischief arose when RIL produced a complex formula for valuation and did not mention the price in dollars or rupees but a formula that came under attack from the high powered economic advisory committee,” the senior advocate said.
“Fraud has been committed in giving approval to the complex pricing policy,” Mr. Jethmalani said before the Bench, also comprising Justices B. Sudershan Reddy and P. Sathasivam.
“The complex formula was put by the RIL to artificially raise the price to $4.20 per unit (from USD 2.34) which is contrary to public interest. We need cheap gas for power and fertilizer plants,” he said.