Reliance Gas Dispute – Government has every right to regulate gas price: RIL

Reliance Group’s counsel Harish Salve made this assertion before the three-member bench of Chief Justice K.G. Balakrishnan, in his counter-arguments in the reliance gas dispute with Reliance Natural Resources Ltd (RNRL) over gas supplies from the Krishna-Godavari basin.

“If I challenge the gas utilization policy and the court says ’sorry, you do not have the power’, the government will discover the power elsewhere,” Salve told the bench, which includes Justice B. Sudershan Reddy and Justice P. Sathasivam.

“The government is opening various sectors to private players. If we do not behave responsibly, we may earn profit for 15 days, but will eventually be out of business.”

“The only suitable agreement for supply of gas to the REL’s Dadri power plant is supply of gas under the gas utilization policy and at the price arrived at as per the formula approved by the empowered group of ministers,” he said.

This decision by the ministerial group is applicable to all the gas produced by Reliance, Salve said, adding this compelled his client to supply gas to specific customers, in defined quantities and at the notified price.

The government has also specified that a firm commitment on gas supplies can be made only for five years, based on the ministerial panel’s recommendations, he said.