Sintex Oil and Gas Limited v. Union of India & Ors

NAVIN CHAWLA, J

DECEMBER 22, 2017 rv

Page 1 * IN THE HIGH COURT OF DELHI AT NEW DELHI + OMP (I) (COMM) NO. 359/2017 Reserved on:12th December, 2017 Date of decision: 22nd December, 2017 SINTEX OIL AND GAS LIMITED ..... Petitioner Through: Mr.Harish Malhotra, Sr. Adv. with Ms.Shivani Kher, Ms.Dhara Doshi & Mr.Ravi Ranjan, Advs. versus UNION OF INDIA & ORS. ..... Respondents Through: Mr.Ravi Prakash, Mr.Farman Ali & Ms.Anshula Laroiya, Advs CORAM: HON'BLE MR. JUSTICE NAVIN CHAWLA 1. The petitioner has filed the present petition inter alia praying for the following relief. "(a) grant an ad interim ex-parte stay on the effect and operation of the termination letter dated 01st September, 2017 issued by the Respondent No.1 to the Petitioner thereby terminating the PSC dated 30th June 2010; (b) pass ad-interim ex-parte orders restraining the Respondents from taking any coercive or precipitate steps in respect of, or invoking, encashing, depositing/receiving any payment under, the following: (i) The Bank Guarantee No.PBGI00701700138 dated 23.03.2017 for an amount of INR 8,30,00,000/- (Rupees Eight Crore Thirty Lac Page 2 Only) issued by the Respondent No.3 in favour of the Respondent No.1; and (ii) the Bank Guarantee No.PBGI00701600310 dated 07.06.2016 for an amount of INR 4,33,62,231/- (Rupees Four Crore Thirty Three Lac Sixty Two Thousand Two Hundred Thirty One Only) issued by the Respondent No.3 in favour of the Respondent No.1". During the course of the oral submissions, the learned senior counsel for the petitioner confined his submissions only with respect to prayer (b) quoted above, presumably because the petitioner itself vide letter dated 24.04.2017 had requested the respondent to accept the letter of surrender of Block-1 granted in its favour under "Production Sharing Contract between the Government of India and Esveegee Steel (Gujarati) Private Limited" (hereinafter referred to as an 'Agreement'). It is to be noted that the petitioner was earlier called Esveegee Steel (Gujarati) Private Limited. 2. It is the case of the petitioner that the petitioner was awarded "S" Type Block in Cambay Basin to undertake the exploration activities under the above mentioned agreement. The initial exploration period in respect of Block-1 was for a period of four years from the effective date, i.e., 15.10.2010 to 14.10.2014. An extension of six months was granted vide 12th MCR dated 08.10.2014 extending the period till 14.04.2015. The petitioner was also granted a Petroleum Exploration license on 15.10.2014 (hereinafter referred to as PEL) validity whereof was extended till 14.10.2017. The petitioner contends that on grant of PEL, the petitioner floated tender for pre-seismic Environmental Impact Assessment ("EIA") and 3D seismic data acquisition and also proceeded to appoint consultant for this work. However, Page 3 as the consultant was unable to accept the proposal, a fresh tender had to be issued where after a fresh consultant was appointed, who also refused to carry out the work. It is alleged that in January 2014, the petitioner was finally able to engage the services of a consultant and commenced the work of digging of 123 upholes, which were completed between January 2014 and March 2014. However, as soon as the activities were commenced, the petitioner started getting rigid resistance from the villagers who started to obstruct / create hurdles as the villagers were afraid that the exploratory activities to be undertaken by the petitioner might shake the upper strata of earth dis-balancing the water table, which was earlier experienced by them when similar activities were undertaken by an another operator in the same area. The villagers further feared that the activities of the petitioner may damage their crops resulting in loss of livelihood. 3. Relying upon Article 9.1 of the agreement, it was contended that it was the duty of the respondent no.1 to provide to the petitioner, the right to ingress and egress from the contract area and to assist the petitioner in procurem