New Delhi, Aug 12 (IANS) Prime Minister Manmohan Singh has been urged to order a probe into the antecedents of a former oil ministry official who scrutinised the price of gas from the Krishna-Godavari basin agreed between the companies led by the two Ambani brothers.
Samajwadi Party Rajya Sabha member Virendra Bhatia, in his letter to the prime minister, said Sunjoy Joshi, who handled the contentious decision in 2006 as a joint secretary in the oil ministry, subsequently joined an organisation promoted by Reliance Industries.

The decision taken by the ministry will not only benefit Reliance Industries but also cause losses worth crores of rupees to the government, Bhatia alleged.

“In January 2007, Joshi was employed, three months after these actions, in Observer Research Foundation, a fully-owned subsidiary of Reliance Industries,” said the letter.

Bhatia, accordingly, has sought a probe by the Central Bureau of Investigation (CBI), the Central Vigilance Commission (CVC) and the Department of Personnel and Training, also to ascertain whether due permission had been sought by Joshi to join the foundation.

When contacted, Joshi said Observer Research Foundation had nothing to do with Reliance Industries, and that there was no conflict of interest in his association with it.

“I would like to say that I am only a research fellow here. It is an independent think tank with several eminent people on its board of trustees and in other capacities. The foundation receives corpus funding from several sources and Reliance is only one among them,” he said.

“Observer Research Foundation does not do any work for Reliance Industries, nor is any member of the company on its board. And again I would like to say that I am only a research fellow here,” Joshi told IANS.

According to Bhatia, Reliance Industries vice-president B. Ganguly had written to Joshi April 14, 2006, seeking the government’s nod for the gas purchase master agreement (GPMA) between Mukesh Ambani’s Reliance Industries and Anil Ambani’s Reliance Natural Resources.

But the oil ministry declined permission.

“It is found not to have been derived on the basis of competitive arms length sales in the region for similar sales under similar conditions,” argued the oil ministry letter in response to the application made by Reliance Industries.

Bhatia said in the letter to the prime minister that Joshi was not only the official to whom Reliance Industries had written its letter seeking the nod for the GPMA, but also a member of the gas price committee for approving the formula.

He also said the ministry’s decision to refuse permission for the contract was designed to help Reliance Industries back out of its binding contractual obligations.

It was calculated not only to scuttle the contract between the two Ambani brothers but also one between the Mukesh Ambani-led company and the state-run power utility NTPC that had floated global tenders for securing the gas, Bhatia said.

It was this decision of the oil minister that triggered a bitter legal battle between the Ambani brothers after Reliance Industries declined to sell gas at the agreed price without prior permission of the government.

In June, the Bombay High Court asked Reliance Industries to supply 28 million units of gas from the fields to Reliance Natural Resources for 17 years at $2.34 per unit after assigning 12 million units to state-run power utility NTPC.

But Reliance Industries challenged the verdict in the Supreme Court, which heard the case July 20 and fixed Sep 1 as the next date of hearing. It also asked all parties to file their replies on the government position on the matter by then.