New Delhi: The Supreme Court rejected division of gas under the Ambani family MoU and said that it was government’s right to decide the price and utilisation of the fuel, which is a national asset.
Delivering the majority verdict of the bench headed by Chief Justice K G Balakrishnan on the four-year gas dispute between RIL and RNRL, Justice P Sathasivam said the Production Sharing Contract over-rides all other agreements.
The family agreement — signed among brothers Mukesh and Anil Ambani and their mother Kokilaben — was not legally and technically binding.
The bench, headed by CJI Balakrishnan who will be demitting office on May 11, also said that the Ambani family MoU can only be a means of arriving at suitable arrangement but cannot be the sole means for a suitable arrangement.
Contrary to speculation that the judgement could be split, the bench held that since the MoU had not been made public, it doesn’t fall in the corporate domain.
Concurring with the judgement, Justice B Sudershan Reddy, who replaced Justice P Raveendran after he recused in November 2009 citing conflict of interest, said that the family MoU cannot be taken into consideration at all.
After a bitter public battle over division of Reliance empire, less than two years of Ambani family patriarch Dhirubhai’s death, Mukesh and Anil reached a family settlement spelt out by mother Kokilaben in June 2005.
As per the settlement, the energy and petrochemicals business went to Mukesh and the power, financial services and telecom business to Anil.
Accordingly, the scheme of de-merger approved by the Bombay High Court in December 2005, paving the way for creation of a new entity — Anil Dhirubhai Ambani group.
However, the bitterness between the two brothers did not cease and the two sides were constantly engaged in public and courtroom battles, with gas dispute reaching the flash point.