Reliance Infra questions RIL's notice

In a sharp retort to a notice of gas supply suspension to one of its power plant, Anil Ambani group firm Reliance Infra on Wednesday questioned the legality of Mukesh Ambani-led RIL's warning for not paying an "illegal" marketing margin.

"Until this bonafide and genuine dispute with regard to legality of marketing margin is resolved, you are not entitled to suspend the operation of the GSPA or disrupt supplies," Reliance Infrastructure wrote to Reliance Industries.

On September 22, RIL served a notice to R-Infra for suspension of gas supply due to payment default for the first fortnight of this month. RIL supplies 0.55 mmscmd gas to R-Infra's power plant in Samalkot plant in Andhra Pradesh.

Last week, the ADAG firm had said that it would stop paying $0.135 per mmBtu marketing margin on the gas it bought from RIL, saying the charge was not authorised by the government and was "illegal".

"We are continuing to make the payment of lawful sales consideration at the rate of $4.2 per mmBtu and are entitled to receive uninterrupted supply of gas under the GSPA (Gas Sale and Purchase Agreement)," R-Infra wrote to RIL.

"...you (RIL) will be entirely responsible for any loss or damage that will be caused to us as a result of any ill- advised action taken by you for non payment of the illegal charge of marketing margin," ADAG firm said, adding that the notice was "misconceived, malafide and is liable to be withdrawn with immediate effect."