The document that Reliance has declined to provide relate to its legal case against the Oil Ministry's refusal to $1 billion of cost recovery as the gas output from the main gas fields in KG—D6 block was not matching the target.

Reliance Industries Ltd (RIL) has provided half of the documents sought by CAG and promised to give most of the remaining when the auditor returns to audit its spending on the flagging KG-D6 fields.

Reliance provided half of the documents to the team of the Comptroller and Auditor General (CAG) during their three-week stay at the company’s office at Mumbai beginning January 9 and wrote to it that the rest, barring a small 10 per cent, would be given when the auditor promised to return on February 11.

Sources privy to the development said CAG, however, wrote back saying it will not be coming as promised on February 11.

In the meantime, CAG Vinod Rai wrote to Oil Minister M Veerappa Moily that Reliance Industries is not cooperating with the audit.

The document that Reliance has declined to provide relate to its legal case against the Oil Ministry's refusal to $1 billion of cost recovery as the gas output from the main gas fields in KG—D6 block was not matching the target.

RIL reasoned that such documents are no way related to audit of spending and revealing its strategy to counter the Ministry will compromise its legal case, sources said.

Also, RIL has refused to provide any documents relating to selection of technology as it felt the auditor cannot sit on judgement using hindsight to question decisions taken 6-7 years ago.

Sources said the firm feels the auditor’s job is to verify expenditure and not question technology selection, which can be done only in a propriety audit and such an audit was beyond the scope provided in the Production Sharing Contract (PSC) for KG—D6.

RIL, they said, has kept the Oil Ministry, on whose written assurance that CAG would follow the audit process set out in the PSC, posted of the developments through weekly updates.

RIL on January 29 wrote to the Ministry that CAG was seeking voluminous documents of years not related to the period under audit (2008—09 to 2011—12).

(This article was published on February 24, 2013)
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