RIL $3.8 billion recovery appeal maintainable: Delhi HC

The Delhi High Court on Monday said it will examine an appeal by the Centre against an order dismissing its plea to recover $3.8 billion from Reliance Industries and another company following a dispute arising from the development of Panna-Mukta and Tapti oil and gas fields.

A bench of Justices Navin Chawla and Madhu Jain said that it did “not find any merit” in the preliminary objection by Reliance Industries and BG Exploration and Production India Limited to the maintainability of the Centre’s appeal challenging the decision of a single judge. “The objection is, accordingly, rejected. As the appeal is now to be heard on merits, subject to orders of Hon’ble the Chief Justice, list the same before the Roster Bench on 17th February, 2026,” the bench ordered.

The bench held that the Centre’s challenge to the single judge’s order had to be adjudicated on its merit.

In 1994, the central Government, through Oil and Natural Gas Corporation (ONGC), had entered into two Production Sharing Contracts with Reliance Industries and Enron Oil and Gas India Limited for the development of Tapti and Panna Mukta Oil and Gas Fields.  BG Exploration and Production India Limited entered into the shoes of ENRON in 2004.

Subsequently, certain differences arose between the parties with respect to provisions on profit sharing, royalties, etc., and the two private companies invoked arbitration. Before the single judge, the Centre filed an enforcement petition in 2019 seeking execution of a “Final Partial Award”, passed by the arbitral tribunal in 2016, to recover a sum of $3.8 billion. In July 2023, the single judge dismissed the Centre’s petition, holding it to be premature. The single judge, however, gave liberty to the Centre to move for execution at an appropriate stage.

Reliance Industries and B.G Exploration contended that the Centre’s appeal against the single judge’s order was not maintainable as the decision did not refuse to enforce the award.