In a major relief to billionaire Anil Agarwal-led Vedanta, the Supreme Court on Wednesday rejected central government's petition challenging the enforcement of a $499-million arbitral award passed in favour of Cairn India (now acquired by Vedanta Ltd.) and Videocon Industries Ltd. The three-judge bench headed by Justice S Abdul Nazeer ruled that Vedanta is entitled to recover a $499 million arbitration award from the Central government for developing Ravva oil and gas fields off the Andhra Coast between 2000 and 2007.
The apex court rejected the Centre's argument that Vedanta along with Videocon Industries is entitled to recover only $198.5 million as proposed in the production sharing contract (PSC) for Ravva oil fields in the Krishna Godavari basin.
The court upheld Delhi High Court's order which refused to interfere with the arbitral award which was ruled in favour of Vedanta. Following Delhi High Court refusal, the centre had moved Supreme Court in June.
Cairn India, which is now acquired by Vedanta, had won an arbitration award in Malaysia in 2011 for higher recoveries instead of the amount that was capped by the Indian government.
The dispute is related to a production sharing contract between Cairn India and the central government with regard to the exploration of the Ravva oil fields for a period between 2000 and 2007.
Following the Supreme Court order, shares of Vedanta were trading 2.67 per cent higher at Rs 134.80 apiece on the Bombay Stock Exchange.
By Chitranjan Kumar