UNION OF INDIA Vs. RELIANCE INDUSTRIES LTD

JUDGEMENT

(1.) The petitioner-Union of India filed the petition under Section 34 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the "Act") challenging the Final Partial Award dated 12th September, 2012 passed by the Arbitral Tribunal comprising the Chairman and two Members, ordering that the respondents? claim in respect of Royalties, Cess, Service Tax and CAG Audit are arbitrable, by rejecting the preliminary objections of the petitioner relating to the arbitrability of the said claims as mentioned in the Statement of Claim.

(2.) The brief facts are that on 22nd December, 1994, two Productions Sharing Contracts (PSCs) came to be executed between the Ministry of Petroleum and Natural Gas, Government of India, Oil and Natural Gas Commission, Reliance Industries Ltd. (respondent No.1) and Enron Oil and Gas India Limited (EOGIL) for the exploration and production of petroleum from the Tapti and Panna Mukta fields respectively. In 2002, BG Exploration and Production India Limited (respondent No.2) acquired the share capital of EOGIL and was substituted in place of EOGIL by amendments to the PSCs. The two contracts were to be operative for a period of twenty five years and would expire only in 2019 unless it is terminated earlier or mutually extended by the parties.

(3.) The respondents are admittedly parties to the two PSCs relating to the Tapti Gas and Panna Mukta Oil Fields, dated 22nd December, 1994. The petitioner and Oil & Natural Gas Corporation Limited are also parties to the PSCs. The relevant provision of Article 15.1 the PSCs reads as under:-