The Telegraph
Since 1st March, 1999
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Centre asked to explain oil selloff

New Delhi, July 25: The Supreme Court today issued notices to the Centre, Hindustan Petroleum and Bharat Petroleum in a public interest litigation (PIL) that challenges the planned disinvestment in the two companies.

A division bench of Chief Justice V. . Khare and Justice S. B. Sinha asked the government to explain why an interim stay should not be clamped on the selloff.

The Oil Sector Officers’ Association had moved the apex court through its suit, which argues that the sale of government’s shares would imperil the nation’s economy since the sector was of “strategic importance” to the country.

Legal eagle Fali Nariman held the brief for the petitioners, contending that the Centre should seek the approval of Parliament before it goes ahead with the sale.

Nariman cited the “oil crisis” in the country after the 1971 Indo-Pak war to buttress his point that private companies cannot import crude from foreign countries. It was then that Parliament moved to nationalise the oil sector and through a legislation to the effect.

However, Attorney-General Soli J. Sorabjee had, in his opinion given to the Centre, said a Parliamentary sanction was not required for selloff in the petroleum sector.

The Centre’s proposes to sell 34.01 per cent in HPCL to a strategic ally and offload 35.02 per cent in BPCL through a share flotation in the domestic and overseas markets.

SCI petition

The apex court’s notices came on a day when the Mumbai High Court dismissed a petition contesting the plan to privatise Shipping Corporation of India (SCI). The suit, filed by Employees Association of the PSU. Essar Shipping, Videocon and Sterlite are in the fray.

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