Mumbai: Portions of the well-guarded memorandum of understanding (MoU), which had formed the basis of the division of Reliance group of businesses between estranged brothers Mukesh Ambani and Anil Ambani in 2005, would come in the open for the first time on Wednesday.
Lawyers for the Anil Ambani-owned Reliance Natural Resources Ltd (RNRL) said they would file “relevant” content from the agreement in the Bombay high court on 8 October, in a bid to resolve the legal dispute with Mukesh Ambani-led Reliance Industries Ltd (RIL).
“We will be filing an affidavit tomorrow (Wednesday) in the court with MoU contents that is relevant to this case,” Ram Jethmalani, RNRL’s legal counsel, said on the sidelines of the court hearing on Tuesday.
He was referring to the closely guarded family agreement that specified how the family assets were to be divided between the Ambani brothers after they decided to split the group. This agreement had been followed by an openly available scheme of arrangement.
The legal dispute between the two companies relates to RNRL’s claim that it has rights to 28 million standard cu. m per day of gas for 17 years at $2.34 (Rs112.32 today) per million British thermal units (mBtu) from the rich reserves that RIL has struck in the Krishna-Godavari basin off India’s east coast.
RIL, India’s largest petrochemical manufacturer and the second largest oil refiner, says it is willing to supply gas to RNRL at the government-approved price of $4.20 per mBtu.
Jethmalani, while impressing the importance of producing the MoU in court, said, “We don’t want the matter to be shrouded in so much mystery. We want the mystery to go.” He added that it was necessary for the document to be produced as the court needs to see if the terms have been faithfully adhered to.
RIL’s lawyer Harish Salve, in his arguments early on Tuesday and the day before, had urged the court to desist from passing an order that would force production of the MoU.
After Jethmalani spoke of filing the affidavit, Salve expressed concern and asked the court to protect the privacy of the document.
Jethmalani told Mint that RIL’s offer to supply gas at $4.20 per mBtu was not acceptable to RNRL, though it was at a steep discount to international gas spot prices of $18-20 per mBtu, because it would mean agreeing to buy gas at prices approved by the government, a benchmark that would likely be revised upwards over time.
Justice J.N. Patel, one of the two judges hearing the case, the other being justice K.K. Tated, asked the lawyers of both companies to finish their arguments before the court breaks for a two-week Diwali vacation, so the bench could work on its order during the festival leave. Justice Patel had initially asked for the MoU to be produced on 2 September. RIL had objected to it then as well.