The Janata Party president has urged Prime Minister Singh to put on hold both the India-UAE 'bilateral' and the Jet-Etihad proposed deal until a thorough independent investigation
Janata Party president Dr Subramanian Swamy has raised several questions on the ownership and effective control of Jet Airways post its deal with Abu Dhabi-based Etihad Airlines and on the security concerns related with the deal. In a letter sent to Prime Minister Manmohan Singh, the Janata Party president had requested to adequately scrutinize the proposal between Jet and Etihad before granting the approval.
He said, "All scrutiny and investigation in the past have for one vested reason or another, been suppressed and never acted upon putting Indian security gravely at risk. The allegations of serious underworld connections from the united Arab Emirates (UAE) continue to haunt Jet's ownership and need to be pre-examined by the Intelligence Bureau (IB), Department of Revenue Intelligence (DRI) and other Intelligence services."
According to Dr Swamy, the process of examining the ownership and effective control, Government needs to first verify the Indian ownership and control, which is supposedly in the hands of a non-resident Indian (NRI), Naresh Goyal.
"It is essential to examine the ownership of Tail Winds Ltd, registered in Isle of Man, a tax haven, as to who the true shareholders and beneficial owners are, prior to and as a consequence of the proposed transaction. This would be important to establish and ensure that it is a genuine and NRI owned company and has no other shareholders. In addition, it should also be proved that it has not been financed from inappropriate and unacceptable sources," Dr Swamy said.
Dr Swamy said, the matter relating to security has been of serious concern to many of us and requires more serious investigation. "In December 2001, Anjan Ghosh, the then joint director of IB, wrote to the Ministry of Home Affairs confirming information about Naresh Goyal's underworld links with Chhota Shakeel and Dawood Ebrahim and also that the funding of Jet Air was with 'tainted Indian money laundered and recycled'. This document had been already submitted in the Bombay High Court. It has since not be overruled or contradicted."
"Under these circumstances, it is essential that a complete investigation be done on the ownership and antecedents of Jet and Jet Air from the year 1993 onwards, till the date of the transaction, including the effective control post the transaction. This investigation should be done by a special investigation team (SIT) of the Central Bureau of Investigation (CBI), the DRI and IB and other appropriate agencies. The information should also be sought under the Tax Information Exchange Agreement with the Isle of Man on the company," Dr Swamy said.
According to the Janata Party president, unless the real owners of Jet Air are established-from inception and more specifically, over the years, it would be a national security threat and risk for India to proceed with a transaction. Sn airline operating in India but being managed from outside, that too with unknown ownership and interest, will prove to the dangerous.
He said, "A great deal of material is available to support that prima facie, monies have been circulated through the company over the years by various methods including by the appointment of GSA's both in India and abroad, in companies such as Jet Air Pvt Ltd, owned by Naresh Goyal."
"In contrast, it has never been established as to who the real owners of Tail Winds are and how they are funded. It is alleged that the funds received now from Etihad have been syphoned out from Jet Airways for the purpose of reorganizing and restructuring the shareholding of Tail Winds to enable Naresh Goyal to show himself as the 51% owner as an NRI. In order to do this he needs to repay the original financers or circulate the funds in such a way that the shares get transferred from Tail Winds to his personal name," he added.
The Janata Party president also raised questions over the valuation of Jet Airways by Etihad. He said, "…the government should go into the details as to why the value of Jet, which is valued by the stock market at around $ 614 million (as on 9th July 2013), is being considered differently by Etihad at about $1,582 million. Is it considering the direct and indirect benefits inuring to Jet through sale of UK slots, sale of privilege memberships, and direct investment in Jet of $375 million?"
"In addition Jet Air has been given a soft loan of $ 300 million. This clearly shows that the entire valuation of Jet is not based on the intrinsic worth of the company but on the value of India's bilateral Rights which are now being given to Abu Dhabi, to benefit their national airline and Naresh Goyal," Dr Swamy alleged.
Talking about sensitivity of the deal in terms of national security, Dr Swamy said there are key concerns relating to operations of foreign controlled airlines on our defence airports and the operations of these airlines in times of national emergency.
He said, "You (the PM) will appreciate it not without reason, that the mature aviation jurisdictions like US and Europe give lot of emphasis in their laws and regulations on ownership and control of airlines registered in their jurisdiction. In this background, I am also dismayed to learn from reliable sources that rather than addressing the national security issues, Government is considering enhancement of FDI, including that of foreign airline, to 74% and simultaneously amending the civil aviation law to remove the ownership and control requirements."
"In fact, as I have been informed, the committee constituted for the purpose of FDI liberalization does not find aviation to be a sensitive issue in the context of our national security. I earnestly appeal to you to please consult the Ministry of Defence and other security and intelligence agencies and also aviation stake holders like the airlines and airports before considering such far reaching policy change," Dr Swamy said.
He said, even the most developed economies like the US and European Union (EU) have clear restrictions on ownership and effective control in order to safeguard their national security and interest. In the case of the US, it is 25% with voting rights and 24% with non-voting. In the case of the EU, it is 49%. Even the bilateral agreements between countries provide that the bilateral rights can only be utilised by airlines where the effective ownership and control rests with nationals in their respective countries, the Janata Party president added.
You may also want to read…
The formulation company has impressed with 66% and 26% rise in net profit and sales, respectively while it has filed another ANDA during the quarter, taking the tally to 15
Ajanta Pharma Ltd, a specialty focused pharmaceutical formulation company, announced 66% rise in its first quarter net profit to Rs33 crore from Rs20 crore a year ago, driven by robust exports and consistent sales across geographies. The company’s revenue from operations stood at Rs219 crore for the three month period ending 30 June 2013, 26% higher compared with same period last year.
According to Moneylife database, the company’s market capitalisation is valued at 13.09 times operating profit while its return on networth stood at 32%.
Commenting on the results, Yogesh Agrawal, managing director, said, “Our sustained performance quarter after quarter reflects the result of our undivided commitment towards brand building leading to sustained business. We have been able to build a strong brand equity across geographies—India and overseas in branded generic space.”
During the quarter, Ajanta Pharmaceuticals filed one more abbreviated new drug application (ANDA) with United States Food and Drug Administration (USFDA), taking the total to 15 ANDAs (2 approved and 13 waiting for approval).
On the occasion of completing 40 years of ‘Serving Global Health Care Needs’, the company’s board has recommended issue of bonus shares in the ratio of one share for every two shares held.
We had recommended the stock last year, on 4 May 2012, to our Stockletters subscribers, at Rs272.
Ajanta Pharma closed Monday at Rs993 on the BSE, down 2.91%, while the 30-share Sensex ended marginally down at 19,593..
All it took to shake a political party that forms a part of the ruling coalition in Maharashtra was a footnote in the bill of small time restaurant in Mumbai. It read: “As per UPA govt eating money (2G, Coal, CWG scams) is a necessity but eating in an AC restaurant is a luxury”
It all started when Sriniwas Shetty, who runs a hotel named Aditi Veg Restaurant in Parel area of Mumbai, decided not to be yet another mute spectator of excesses unleashed by the United Progressive Alliance (UPA) government. On one hand, the UPA broke hell on citizens by executing one scam after another; and on the other, in utter clumsiness, has started squeezing the working class by levying various taxes.
This quiet, novel way of voicing the protest, without any breast-beating went unnoticed for over a fortnight, until someone posted it on Twitter. The image of that defiant unique message went viral on the social media and was greeted with rousing applause.
But our intolerant political environment would not take this ‘nonsense’. Congress workers decided to intimidate the restaurateur, whose protest had charged thousands of angry but otherwise mute (or sometimes raucous only in social media) Indians. On 22nd July 2013 Congress workers swooped down on the restaurant.
Ganesh Yadav, the president of the Indian Youth Congress forced Aditi Restaurant to shut down. He has since been quoted saying that he didn’t ask the restaurant to shut down and the protest was against the ‘defamation’ of his party by the restaurant. As reported by the Mumbai tabloid, The Mid-Day, a non-congizable offence was registered at the Bhoiwada Police station under Sec 501 for defamation.
Unfortunately, for the Congress, the act of intimidation probably did far worse damage than the bold footnote. The reports about Congress workers shutting down #Aditihotel (a popular hashtag that day) spread fast on social media. Thousands of voices supported Aditi and lambasted the action. Typically, the electronic media launched discussions and fresh reports (subsequently denied) that instructions to attack Aditi had come from Delhi flowed in.
The upshot was that the restaurant opposite KEM Hospital, one of the busiest places in Mumbai, reopened for business in a few hours. But it is probably never going to go back to its humdrum existence. The firm voice of protest against corruption continues to inspire people and many of people have been making a little trip to Parel, only to say ‘Bravo’ or ‘Congratulations - You are not alone’. On Sunday, 28th July, Sampat Shetty, a journalist, persuaded the restaurant to create a book to record voices of support!
But this is not enough. Why should the mere recording of an opinion about the mega financial scandals under the UPA government amount to defamation? Each scam mentioned in the footnote has been a subject of endless media debate and innumerable screaming headlines. How then, can a footnote attract action? Sec 501 of the IPC is titled: Printing or engraving matter known to be defamatory. It says, “Whoever prints or engraves any matter, knowing or having good reason to believe that such matter is defamatory of any person, shall be punished with simple imprisonment for a term which may extend to two years, or with fine, or with both.”
Does it apply in Aditi Restaurant’s case? Well, this is for legal experts to debate-there are strong views on both sides. The police, as usual, took the easy root of pleasing the protestors by filing a complaint. This incident, like others, will probably be buried and forgotten after a while. But it is yet another instance of growing intolerance against dissent and using intimidation to suppress disagreement.
While the token show of solidarity with Aditi Restaurant in terms of physical visits and on social media are welcome gestures, ultimately they are no more than gestures. We, the people have to find ways to signal to the political establishment that we are tired of corruption, intimidation and the attempt to mute our voices. What is the way forward?