The government as the owner of gas from KG basin on Friday said it has every right to dictate RIL to whom it should supply the feed to, but the company disputed this claim.
"RIL is a mere contractor. Government is the owner of the gas. Government will direct RIL who will receive gas. It has right to decide on gas-allocation policy," additional solicitor general Mohan Parasaran told reporters on Friday outside the Bombay high court, which is hearing a gas supply dispute between Mukesh Ambani-led RIL and Anil Ambani group firm RNRL.
Earlier, Parasaran told the court that an empowered group of ministers has decided that RIL would supply gas to the upcoming power projects, including Anil Ambani group's Dadri power project once the projects are ready, subject to availability of the gas at that time.
Commenting on the EGoM decision regarding supply of KG gas to upcoming power projects, RIL counsel Harish Salve said, "Government has no right to allocate gas."
He clarified that his client was opposed to this stand of the government.
The court has, as of now, stayed the sale of gas from RIL's KG gas basin to third parties, but government wants the stay vacated.
The division bench of Justices J N Patel and K K Tated indicated that they may pass an interim order regarding stay on Monday, hinting that court might vacate the stay as far as sale of gas to PSUs was concerned.
"We might vacate stay to the extent of government's requirement," Justice Patel said.
During the arguments on Friday, Salve said that if RNRL wanted to seek damages for delay in Dadri project, on account of lack of bankable contract, then it should bring on record RBI permission to ADAG for External Commercial Borrowings.
Salve had earlier alleged that money was not the issue for Dadri power project as ADAG had borrowed money from foreign lenders -- which was put in mutual funds instead of the project.
RNRL's case is that because RIL did not offer it a sound gas supply contract, it could not raise money for the Dadri power project.
