HC slaps show cause on CBI, ministry on Mukta-Panna

NEW DELHI, July 30: The Delhi High Court today issued show cause notices to the Ministry of Petroleum, the Central Bureau of Investigation,...

NEW DELHI, July 30: The Delhi High Court today issued show cause notices to the Ministry of Petroleum, the Central Bureau of Investigation, and ONGC on a petition which seeks the cancellation of the Mukta-Panna oil field contract to Reliance Industries Limited (RIL) and the US multinational Enron. The parties have been given upto August 28 to furnish their replies.

The joint petition has been filed by the Centre for Public Interest Litigation (CPIL) and National Alliance of People’s Movement, and alleges that a huge amount as bribe was paid to the then petroleum minister, Satish Sharma, for awarding the contract to the RIL-Enron joint venture in February 1994. It also quotes heavily from a CAG report which had criticised the deal on several grounds.

The case was highlighted when, late last year, a former aide to Sharma alleged that the Ruias of Essar, the Dhoots of Videocon and the Ambanis of RIL had bribed the minister for lucrative oil contracts. The aide, B.N. Safaya had alleged that the Ambanis had paid Sharma Rs 4 crore for his help in winning the contract for Mukta-Panna oil wells off Bombay High.

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Arguing for the petitioner, senior advocate Shanti Bhushan contended that the CBI had done some preliminary investigations but that this had been scuttled.

It was alleged that ONGC had spent Rs 500 crore to develop the field and this was given to RIL-Enron for a pittance. "It was completely unconscionable to give away these oil filds having oil worth more than Rs 18,000 crores at current prices for a total one-time amount called signature and production bonus of Rs 12 crore,” The petitioners pointed out that in the case of Videocon, at least, the Government recovered a part of the past cost by asking for Rs 98 crore while awarding the contract for the Ravva oil fields.

While officials of the ministry of petroleum were unavailable for comment, RIL officials declined to comment on the bribery charges as the matter was sub judice.

They, however, contended that the petitioners argument was flawed. Stating that the deal was not a one-sided one and had been scrutinised by several committees over a period of one year, they added that ONGC was sharing profits from the field as it is a 40 per cent partner — the issue of reimbursement of past cost had even been examined by the Cabinet.

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According to RIL officials, a total of 42 medium and minor oilfields have been awarded to private players on similar conditions.

According to the petitioners, on January 16, 1996, Y P Singh, superintendent of police in anti-corruption unit (ACU) at CBI’s Mumbai office, submitted a detailed report on the contract of Mukta-Panna oil fields pointing out a large number of irregularities in the award of contract, the petitioner said. According to Singh, the loss to the exchequer on this account was Rs 7,507 crore.

However, the request for registration of an FIR in the case was with-held by the then joint director of CBI, Mahendra Singh Kumawath, and the same was not sent to the headquarters in Delhi, the petitioner alleged. CAG report states "estimates of oil reserves from these fields kept changing in different documents repared by the government."