Indraprastha under fire

CNG dispensing company rapped for taking Supreme Court for a ride

By Lopamudra Banerjee
Published: Monday 30 September 2002

on september 9, 2002, the Supreme Court (sc) cracked the whip on compressed natural gas (cng) dispensing company Indraprastha Gas Limited (igl) for furnishing wrong information about its capacity to meet Delhi's requirements. igl came in for a severe tongue lashing, with a three-judge bench comprising Chief Justice B N Kirpal, Justice V N Khare and Justice Ashok Bhan observing that it was "thoroughly incompetent and not a reliable company". The court also asked the present as well as former top brass of igl to show cause why action should not be initiated against them and the company for having misled the court.

It was on the basis of the figures provided by igl that the apex court had rejected the Union and Delhi governments' pleas to reconsider an earlier order for a complete switchover of the city's bus fleet to cng mode. On April 5, 2002, the sc had mandated the Union government to "make available" 16.1 lakh kilogrammes (kg) per day of cng. This directive had also been issued, taking into account igl affidavits promising that the company would increase its dispensing capacity. But igl has now submitted that its former officials had given incorrect figures to the sc. An incensed Justice Kirpal noted: "This court was completely kept in the dark and was misled ... that compression capacity and dispensing capacity were one and the same ..." With igl's role in the cng controversy becoming clear, it is quite evident who's to blame for the serpentine queues at cng stations in the capital (see box: What's behind the logjam?). igl also manipulated projected sales, profits and costs to justify the recent hike in cng prices.
Figures fudged As far as the price factor is concerned, igl's patron -- the Union ministry of petroleum and natural gas - has landed it in a mess. Under pressure from the ministry, igl is said to have raised the price of the green gas from Rs 13.11 to Rs 16.83.

The apex court, concerned about the stability of the cng programme, directed the Environment Pollution (Prevention & Control) Authority (epca) to ascertain the real reason behind the move. In a bid to justify the price hike to the epca, the gas dispensing company made desperate attempts to blur details. The epca's ensuing report to the court throws light on this dubious practice. igl has projected low demand, sales and earnings, thus validating the price rise as a cost recovery exercise.

The company's estimates pegged demand for gas in Delhi at much lesser than the sc stipulation. This enabled the company to further lower gas consumption estimates. igl also reportedly underestimated vehicle growth to reduce the overall projected demand for gas in the transport sector.
Facts contorted Arguing for adequate cng dispensing facilities, igl has tried to confuse the court further by claiming that there is a difference between what it can compress and actually dispense. This is in sharp contrast to what the company had stated earlier. Strangely, igl's new counsel, P Chidambaram, has revealed these issues to the sc only now. "We cannot rely on igl anymore," said the bench and added: "We have got brickbats because of you."

It was amicus curiae Harish Salve who brought the discrepancies in igl's claims to the court's notice. When the sc asked the company to clarify, Chidambaram admitted without compunction that igl had lied earlier, but was now speaking the truth. "There is no falsehood, but there is no truth either," retorted Justice Kirpal.

igl's manipulations to shield its incompetence not only threaten its own interests, but will also harm the nascent cng programme in the capital.

Subscribe to Daily Newsletter :

Comments are moderated and will be published only after the site moderator’s approval. Please use a genuine email ID and provide your name. Selected comments may also be used in the ‘Letters’ section of the Down To Earth print edition.