RIL puts Rel Infra on notice over payment

Fresh Trouble Brews Between Bros Over Gas Supply TIMES NEWS NETWORK  New Delhi: Mukesh Ambani's Reliance Industries on Thursday said it has warned Anil's Reliance Infrastructure of stopping gas supplies on grounds of "payment default''. The action drew a sharp reaction, with the latter describing it as "mala fide'' and warning of strong action.      An RIL spokesperson said the notice for stopping supply was prompted by a payment "default'' on part of Reliance Infrastructure for gas supplied during the first fortnight of September. "The notice has been issued in accordance with the terms of GSPS (gas sale and purchase agreement),'' it said. Sources said RIL had also invoked the LC (Letter of Credit or bank guarantee) to recover Rs 12 lakh towards marketing margin for supplies in the first half of this month.      Reliance Infra shot off a letter to RIL on Thursday questioning the legality of the notice, dated September 22. "Until this bona fide and genuine dispute with regard to legality of charges towards marketing margin is resolved, you are not entitled to suspend supplies,'' the letter said.      Reliance Infra has been getting gas from RIL for its 220mw Samalkot power plant in Andhra Pradesh for the past five months at a price of $4.2 per unit and marketing margin of 13 cents per unit.      "We are continuing to make the payment of lawful sales consideration at the rate of $4.2 per unit and are entitled to receive uninterrupted supply of gas under the GSPA (gas sale and purchase agreement)... 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,'' Reliance Infra said.      The Anil Ambani group, fighting a legal battle for securing 28 million cubic metres per day of gas for group firm RNRL from RIL at $2.34 per unit under a family settlement, had last week questioned the marketing margin and had informed RIL that it would not pay the same.      Reliance Infra had contended that RIL's gas supply agreement was not a result of any marketing undertaken by the company or any agency and "since there has been a complete absence of any marketing, the charge in respect of marketing margin is clearly unwarranted''.