9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2016 (4) TMI 1366 - SC - Indian LawsJurisdiction - power of Union of India - mineral oil resources and inflammable substances, which includes RLNG - whether Union of India is competent to take the policy decision? - Held that - By virtue of Article 73 of the Constitution of India read with Entry 53 of List I, the Union has the power to legislate and take policy decisions in relation to the matters pertaining to mineral oil resources and inflammable substances, which includes RLNG. Further, as has been correctly recorded in the impugned judgment and order, there is no existing legislative provision as far as fixing of the price of RLNG is concerned. Thus, the executive of the Union of India is well within its right to exercise its powers under the Constitution to take such decisions by way of policy decisions. The respondent-Union of India passed the impugned policy decision dated 06.03.2007 in the larger public interest, keeping in view the need to provide RLNG at viable prices to the existing and new customers alike. It is further clear that it is nearly impossible to predict or even control LNG prices, as the same are controlled by global market forces. The only way to have any semblance of control over the prices of RLNG was to pool the prices of RLNG procured by the off-takers under long term contracts - it becomes clear from a perusal of the documents produced on record that the executive policy decision dated 06.03.2007 to pool the price of RLNG was arrived at after elaborative discussions between representatives of Qatar, India, IOC, BPCL, GAIL, ONGC and other experts in the field. It was an informed decision taken in the interest of the public at large. There being no evidence to suggest that the impugned policy direction is illegal, arbitrary, unreasonable or otherwise violative of Article 14 of the Constitution of India, we find no reason to interfere with the same - the impugned policy decision dated 06.03.2007 does not suffer from any infirmity in law and is hereby upheld - Appeal dismissed.
Issues Involved:
1. Validity of the policy decision dated 06.03.2007 by the Union of India. 2. Whether the policy decision is arbitrary, unjust, or violative of fundamental rights. 3. Impact of the policy decision on existing contracts and whether it led to unlawful price increases. 4. Whether the appellants are entitled to a refund due to the price increase. Issue-wise Detailed Analysis: 1. Validity of the Policy Decision Dated 06.03.2007: The Supreme Court examined the policy decision dated 06.03.2007, which directed Petronet to charge uniform pooled prices for RLNG to all customers. The Court noted that the Union of India is competent to take such policy decisions under Article 73 of the Constitution read with Entry 53 of List I of the Seventh Schedule. The policy aimed to unify RLNG prices to avoid discrimination between old and new customers and was taken in the larger public interest, particularly to support the viability of the Dabhol power project (RGPPL), which had significant public investment. 2. Whether the Policy Decision is Arbitrary, Unjust, or Violative of Fundamental Rights: The appellants contended that the policy was arbitrary and benefitted only RGPPL. However, the Court found that the policy was applied uniformly to all long-term RLNG contracts and was not discriminatory. The decision was taken after extensive deliberations involving various stakeholders, including the Ministry of Petroleum and Natural Gas, IOCL, BPCL, GAIL, ONGC, and Petronet. The Court emphasized that it is not within its jurisdiction to question the wisdom of such policy decisions unless they are demonstrated to be arbitrary, unreasonable, or mala fide. 3. Impact of the Policy Decision on Existing Contracts and Whether it Led to Unlawful Price Increases: The appellants argued that the policy violated their contracts, which had fixed prices for RLNG. The Court referred to Clause 11.4 of the Supply Agreement, which allowed for price revisions due to changes in government policy. Therefore, the price increase resulting from the policy decision was within the contractual terms agreed upon by the parties. The Court also noted that the policy decision was authenticated by the Under Secretary to the Government of India and was within the powers conferred by the Business Transaction Rules, 1961. 4. Whether the Appellants are Entitled to a Refund Due to the Price Increase: The appellants sought a refund of the differential prices paid due to the policy decision. The Court held that since the policy decision was valid and within the contractual terms, the question of refund did not arise. Additionally, the Court noted that the appellants had not provided evidence to show that they had borne the burden of the price increase without passing it on to their customers. The concept of unjust enrichment was also discussed, highlighting that a refund would result in unjust enrichment if the appellants had already passed on the burden to their customers. Conclusion: The Supreme Court upheld the policy decision dated 06.03.2007, finding it neither arbitrary nor discriminatory. The decision was taken in the larger public interest and was within the executive powers of the Union of India. The appellants were not entitled to a refund as the price increase was within the contractual terms and there was no evidence of unjust enrichment. The appeals were accordingly dismissed.
|
