Rhys Blakely in Mumbai
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India’s Supreme Court will be forced to restart proceedings tomorrow in a bitter court battle over natural gas between Mukesh and Anil Ambani, the country’s two richest brothers, after it emerged that a daughter of one of the judges hearing the case is linked to one of the brothers’ advisers.
The restart was forced after Justice Raveendran, one of the three judges hearing the case, withdrew after saying his daughter was associated with a company that was an adviser to one of the parties in the case. He declined to name the company.
Mohan Parasaran, the government's counsel, said: "The court will start fresh hearings from tomorrow. The match will be replayed."
Observers had expected the case to reveal a number of relationships between state officials and one of India's wealthiest families.
Mukesh and Anil Ambani, who are worth more than £18 billion between them, have become infamous for their mutual animosity. Such is their wealth and influence -- between them, they account for more than 5 per cent of India’s GDP -- some fear their feuding poses a threat to the country’s prosperity.
Their fiercest dispute has been over the price at which Reliance Natural Industries, Mukesh's company, will sell natural gas to Reliance Natural Resources Limited, Anil's company, from the D6 block of the Krishna-Godavari basin in the Bay of Bengal – the subject of the current case being heard by India's highest court in Delhi.
Anil is arguing that Mukesh is trying to break a deal under which he is obliged to sell gas to Anil's power production business at a fixed price of $2.34 per million British thermal units (MBtu) for 17 years.
In 2006, Mukesh claimed the deal needed the approval of the Indian Government, which consequently set a higher price, of $4.20 per MBtu, setting into motion an epic legal battle. The stakes are high: Mukesh is expecting to make $11.5 billion from the gas if it is allowed to sell it at $4.20. If Anil wins the court case, that may turn into $5.4 billion loss, analysts said.
The future of Anil’s Reliance Natural Resources, currently valued at nearly £2 billion, hangs in the balance. The gas supply contract, Anil told shareholders in July, is “our company's primary asset and contributes most of its value.”
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