SAHELI EXPORTS PVT. LTD. Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioner has sought for issuance of a Writ of Certiorarified Mandamus to call for the records of the first respondent in F.No.L-12013/2/2015-GP-I dated 11.09.2020, cancelling the allotment of natural gas to the petitioner made, vide allotment letter dated 5.6.2000, which is being used continuously by the petitioner for generating power at petitioner's power plant and consequently for a direction to the first respondent to restore the original allotment made to the petitioner.

(2.) The petitioner is a company incorporated under the Companies Act, 1956, involving in the business of setting up power plants and generating electricity. The petitioner also had set up a natural gas based 8.8 MW power plant at Komal West Village, Nagapattinam District. The natural gas is to be used as fuel at the petitioner's power plant i.e., supplied by the second respondent. The first respondent has granted permission to Oil and Natural Gas Corporation (ONGC), which was selling gas directly to the consumers till 1992. Pursuant to the Government Policy, it was transferred to the second respondent/GAIL. The petitionerCompany had set up its natural gas based power plant during April 2005. The entire natural gas supplied by the second respondent had been used only for the purpose of generation of power. However, originally, the petitioner had sought for allotment of natural gas for generation of power, which was to be utilised for manufacture of steel, which was to be set up by the petitioner. Hence, it is understood that the gas supply was required by the petitioner for the purpose of generation of power for its proposed steel plant. On 23.12.1999, a request for allocation of natural gas was made by the petitioner stating that the gas is for production of power for utilising the same in its proposed steel plant. However, in the allotment letter dated 05.06.2020, issued to the petitioner by the Ministry of Petroleum and Natural Gas, it is mentioned that the gas allotment is for manufacture in the steel plant. The letter of allocation dated 05.06.2000 had two conditions, ie., (i) the petitioner should pay the relevant transportation charges and (ii) the petitioner should enter into a gas supply contract with the second respondent within 60 days, which means that there is no condition with regard to use of gas.

(3.) Accordingly, a contract dated 06.10.2000 came to be entered into between the petitioner and the second respondent. The said contract clearly stated that the gas is to be used for generation of power for use in the steel plant. It is stated that as proposed, the steel plant did not take off. Since the steel plant project was abandoned, the power generated in the plant using the gas allotted to the petitioner, was sold to captive consumers including a steel plant using the state grid. It is stated that the subsequent amendment agreement dated 03.05.2003 with the second respondent categorically stated that the gas allotted to the petitioner is for use of fuel at its power plant.