New Delhi, Oct 27 : The Supreme Court Tuesday wondered if it was still possible for Mukesh Ambani's Reliance Industries and the Anil Ambani-led Reliance Natural Resources to negotiate a "suitable agreement" for gas supplies from the Krishna-Godavari basin.

"There must be parameters to arrive at suitable arrangements for supply of gas," the Supreme Court observed as it resumed hearing the dispute for the fourth day over the supply and pricing of gas from Reliance Industries to Reliance Natural Resources.    

"Either you negotiate or we can direct you to go for arbitration," remarked the three-member bench of Chief Justice K. G. Balakrishnan, Justice R. V. Raveendran and Justice P. Sathasivam.    

The observations came when the counsel for Reliance Industries Harish Salve resumed his arguments and continued to maintain that the Ambani family reorganisation pact had no bearing on his client, which was a company.    

"Anything not approved by the board or shareholders is not part of the scheme. The board has the last word. There is no occasion to look beyond it," contended Salve.

"The Reliance Industries board had no knowledge of the private agreement," he said, while adding that a suitable arrangement as per the 2005 pact was not working.    

According to him, a better and more suitable arrangement now was the gas utilization policy spelt out by the government. "But as per this policy, Reliance Industries is neither free to fix the price nor choose the buyer."

These remarks prompted Ram Jethmalani to intervene on behalf of Reliance Natural, saying his client was not against the government's gas utilisation policy, but it should be implemented prospectively and not retrospectively.    

"It should not affect the existing agreement."    

Jethmalani also said Reliance Industries will make a profit of several thousand crores even if it sells gas at $2.34 per unit, as demanded by his client.    

"It's fraud on the nation. You (Reliance Industries) are making thousands of crores," Jethmalani said, while accusing Salve of repeating the same arguments ad infinitum, which was "taxing his nerves".    

Salve shot back: "I am going to argue for another three days. You better relax till then."    

The dispute is over the supply of natural gas from the Krishna-Godavari basin that was awarded for exploration and harnessing to Reliance Industries, before a split in 2005 in the group founded by legendary industrialist Dhirubhai Ambani.

Based on a family reorganisation pact, the Anil Ambani Group wants 28 million units of gas per day for 17 years at $2.34 per unit. But Reliance Industries says it can only sell it for $4.20 per unit, claiming this was the price fixed by the government.

Earlier, when Salve was arguing about commercial non-viability of supplying gas at $2.34 per unit, the bench asked if he had not conceded before the court that Reliance Industries will make profit even by selling gas at that price.    

Salve said: "I did not concede. It's a complex subject. Some time communication slips. We will put everything in writing."(IANS)