Bombay HC Seeks Response on CBI Probe into RIL-ONGC Gas Theft Allegations

MUMBAI – The Bombay High Court has taken cognizance of a significant public interest litigation, issuing notices to the Central Bureau of Investigation (CBI) and the Union of India in a plea seeking a criminal investigation against Reliance Industries Limited (RIL) and its directors. The petition alleges the illicit extraction of natural gas valued at over USD 1.55 billion from the blocks of the state-owned Oil and Natural Gas Corporation (ONGC) in the Krishna Godavari (KG) Basin.

A Division Bench comprising Justices A.S. Gadkari and Ranjitsinha Raja Bhonsale issued the notices on November 4, scheduling the next hearing for November 18, 2025. This judicial action breathes new life into a long-standing and complex dispute, shifting the focus from civil and arbitral forums to the potential for a high-profile criminal probe into one of India's largest corporate entities.

The petition, filed by citizen Jitendra P. Maru, calls for the court to direct the CBI to register a First Information Report (FIR) against RIL and its leadership, including Chairman Mukesh Ambani, for alleged offenses of theft, dishonest misappropriation of property, and criminal breach of trust.

The Core Allegations: A Decade of Alleged Siphoning

At the heart of the petition is the accusation that RIL engaged in what is described as a "massive organized fraud" spanning nearly a decade, from 2004 to 2013-14. The modus operandi, as detailed in the plea, involved RIL drilling wells in its contracted deep-sea block in the KG Basin and then extending them sideways to tap into and extract natural gas from adjacent gas reserves belonging to ONGC.

The alleged malpractice was reportedly discovered by ONGC officials in 2013, who then brought the matter to the attention of the Government of India. In its defense, RIL has historically maintained that the gas was "migratory" and that as it had flowed into their block, they had the right to extract it—a position that has been contested through multiple expert and judicial reviews.

The petitioner leans heavily on the findings of two critical reports to substantiate the claims:

• De Golyer and Macnaghten (D&M) Report: An independent investigation by the US-based consultancy confirmed that gas had indeed migrated from ONGC's block to RIL's and that RIL's wells had tapped into ONGC's reserves without authorization.
• A.P. Shah Committee Report: Following the D&M findings, the Union Government constituted a one-man committee headed by retired Justice A.P. Shah. This committee was tasked with quantifying the extent of the extracted gas and recommending a course of action. The committee concluded that RIL had derived "unjust enrichment" and quantified the value of the gas produced from ONGC's block at over USD 1.55 billion , with an additional USD 174.9 million in accrued interest.

The petitioner argues that these meticulously documented findings provide a sufficient basis for initiating a criminal investigation, moving beyond the question of civil liability and compensation.

Legal Precedent and the Delhi High Court's Decisive Ruling

A pivotal development underpinning the current plea is a recent order from the Delhi High Court. RIL had previously secured a favorable award in its arbitration proceedings against the Union of India concerning the gas dispute. However, this victory was short-lived.

In a landmark decision on February 14, 2025, a Division Bench of the Delhi High Court allowed the Union of India's appeal and set aside the arbitral award. The court's reasoning was profound and legally significant: it concluded that the award was "against the public policy of India."

This ruling is a cornerstone of the petitioner's argument. The finding that the arbitral award violated public policy implicitly suggests that the tribunal's decision overlooked fundamental principles of morality, justice, and national interest. For legal practitioners, this sets a powerful precedent, reinforcing the judiciary's supervisory role over arbitral proceedings, especially in cases involving national resources and potential large-scale corporate malfeasance. The petitioner leverages this judicial determination to argue that the matter transcends a mere commercial dispute and involves elements of criminality that warrant investigation by a premier agency like the CBI.

Jurisdictional Nexus and the Path Forward

The petition strategically establishes the jurisdiction of the Bombay High Court and the CBI by asserting that the alleged criminal conspiracy originated and was orchestrated from RIL's corporate headquarters in Mumbai. This claim is crucial for bringing the case within the purview of the Mumbai-based court and the CBI's jurisdiction for investigating pan-India economic offenses.

The relief sought by the petitioner is comprehensive. It goes beyond merely asking for an FIR and includes prayers for: - The seizure of all relevant documents, including contracts, drilling data, investigative reports, and the complete findings of the A.P. Shah Committee. - Court supervision of the investigation to ensure impartiality and thoroughness. - The filing of formal charges against all individuals, known and unknown, found to be complicit in the alleged scheme.

As the Bombay High Court awaits responses from the CBI and the Union of India, the legal community will be watching closely. The court's decision on whether to order a CBI probe will have far-reaching implications. It will test the boundaries between civil liability and criminal culpability in complex corporate disputes, the efficacy of PILs in enforcing corporate accountability, and the weight given to prior judicial findings—like the Delhi High Court's "public policy" determination—in subsequent criminal proceedings. This case could become a defining moment in India's corporate governance and resource management jurisprudence.