Delhi HC allows Vedanta to continue deducting government share in Rajasthan oil field
On Friday, the Supreme Court of Delhi rejected the center from reducing the payment of payments from revenue share in some Rajasthan oil and gas fields.
Justice Jasmeet Singh rejected the government’s request to prevent Vedanta from receiving the 2023 referee award with a temporary order as part of an arbitration dispute. So far the farewell has set $ 377 million (about about La3,235 CRORE) For the second, third and fourth quarter of 2023-24, it does not set more than 157 million dollars from temporary income estimates ( La1.347 Crore).
The court decided that Vedanta had the right to maintain these deductions as permitted by the Arbitration Award, and also allowed the mining company to review the corrections for the fourth quarter of the 23 financial years.
“For the above reasons, this court stated that as stated above, within the limited judicial authority, especially the EC (Arbitration Court), not to re -evaluate or change the view, especially the horse, the appraisal is to determine the appeal of appeal because I have not found any reason for restructuring any reason.
The decision, in fact, allows Vedanta to continue its deductions until it is measured by the final payment arbitration court.
‘Vedanta only follows the award’
The Union Government suggested that Vedanta had reduced unapproved payments, as the Arbitration Award did not specify a definite monetary amount.
However, the Supreme Court of Delhi decided that Vedanta had only followed the award, which clarified how the cost and profit should be shared within the scope of the production sharing agreement for the Barmer Oil Block in Rajasthan.
The Court said that the basic issue that Vedanta’s cuts have been fully adjusted or whether more and more to remain to be saved is that the court decides during the quantitative procedures.
As he declared the award, the decision to decide on the validity of the deduction would no longer intervene in the court’s jurisdiction, and the Court announced that the order of the government would not affect the main challenge against the arbitration decision remaining waiting.
The Declaration Award shall explain the rights, obligations or comments within the scope of a contract without ordering or ordering. Resolve disputes on how to read or apply agreements.
In the case of Vedanta, the court explained how the costs and profits under the production sharing contract should be calculated, but did not correct the exact amounts, and if he could not agree on the parties, he left the final payment later.
A 30 -year -old dispute
The dispute is based on the 1995 production sharing agreement between the Union Government, Shell (later purchased by Vedanta) and Petroleum and Natural Gas Corporation Ltd For barmer oil block.
The 25 -year contract ended in May 2020, but it was extended for more than 10 years. However, the General Directorate of Hydrocarbons increased the audit objections for 2016-17 and 2017-18 financial years.
The government accused Vedanta of violating the conditions of the production sharing contract, which he claimed to have misrepresented costs for the discovery, development and production activities in the Rajasthan block, and that Vedanta claimed to decrease a lower profit share for the government.
Vedanta objected to these findings and initiated arbitration.
In August 2023, the Court rejected most of the government’s allegations, issued a last partial award that largely preferred Vedanta, but did not correct the final payment amounts. The award was partially modified in December 2023.
Vedanta’s arbitration victory included the rejection of higher payment requests of the government after not allowing costs worth $ 1.16 billion (( LaAllocation of certain common costs, including 9,545 crore) and pipeline expenses.
The government objected to this award at the Supreme Court of Delhi, arguing that India contradicts public policy and legal principles.
