World
Won arbitration case against India, says Devas Multimedia
India has lost its arbitration case in an international tribunal against Bengaluru-based Devas Multimedia Private Ltd for cancelling its space/satellite contract with the government-owned Antrix Corporation, Devas said on Tuesday.
 
In a statement, Devas said: "A Permanent Court of Arbitration tribunal has found that the government of India's actions in annulling a contract between Devas and Antrix Corporation Ltd., and denying Devas commercial use of S-band spectrum, constituted an expropriation."
 
The ruling on Monday was the second by an international tribunal arising out of the cancellation of the contract between Devas and Antrix, the commercial arm of Indian space agency Indian Space Research Organisation (ISRO), the statement added.
 
The Hague-based tribunal, which regularly takes cases involving states, including investment treaty claims brought under the arbitration rules of the United Nations Commission on International Trade Law (UNCITRAL), also found that India breached its treaty commitments to accord fair and equitable treatment to Devas's foreign investors.
 
According to Devas, the unanimous decision included the arbitrator appointed to the tribunal by India.
 
Reacting to the development, G.Madhavan Nair, who was ISRO Chairman when the deal was signed, told reporters in Thiruvananthapuram that all this happened because of the UPA-2 government.
 
S. Rakesh, Chairman-cum-Managing Director of Antrix Corporation Limited, was not available for comments.
 
In an earlier decision, an International Chamber of Commerce (ICC) tribunal in 2015 found unanimously that Antrix's repudiation of the contract was unlawful, and awarded Devas damages and pre-award interest of approximately $672 million, plus post-award annual interest accruing at 18 per cent until the award is paid in full.
 
The courts in Britain and France have recognised the ICC award and held it to be enforceable.
 
According to Devas Chairman Lawrence Babbio, with the PCA award, two international tribunals have now unanimously agreed that financial compensation should be paid after annulment of Devas's rights.
 
"Other courts in France and the United Kingdom have agreed that the award against Antrix ought to be enforced. We prefer a mutually agreeable resolution of this matter. But until that occurs, Devas and its investors will continue to press their claims before international tribunals and in courts around the world," Babbio was quoted as saying in the statement.
 
The PCA tribunal unanimously found that by annulling the contract in 2011 and denying the commercial use of S-band spectrum, the Indian government expropriated the investments of Devas's foreign shareholders and also acted unfairly and inequitably, thus making it liable to pay financial compensation.
 
Antrix entered into an agreement with Devas in 2005 for the long-term lease of two ISRO satellites operating in the S-band.
 
However, the then United Progressive Alliance government cancelled the controversial contract in February 2011, invoking sovereignty and decided to use the advanced satellite for the country's strategic use.
 
Under the annulled deal, Antrix was to lease satellite transponders to Devas for allowing it to offer digital multimedia services using the S-band wavelength (spectrum), reserved for strategic purpose.
 
The space agency launched the GSAT-6 on August 27, 2011 from its spaceport at Sriharikota in Andhra Pradesh, about 90 km north of Chennai, as a communication satellite, using a heavy rocket.
 
In June 2016, the Enforcement Directorate (ED) had issued a notice to Devas for alleged violation of foreign exchange laws involving around Rs 1,200 crore.
 
According to a government statement, Devas Multimedia is suspected to have received foreign direct investment of Rs 578.54 crore between May 2006 and June 2010 from various overseas investors, including CC Devas Mauritius Ltd, Telecom Devas Mauritius Ltd, Deutsche Telkom Asia Pvt. Ltd. and Devas Employees Mauritius Pvt. Ltd. in violation of the provisions of the Foreign Exchange Management Act.
 
The ED said the share subscription agreements entered by Devas Multimedia with the investors contained clauses relating to settlement of disputes in courts other than those in India and applicability other than Indian laws in matters of dispute, and thus, the FDI received by the firm was contrary to the conditions specified in the approvals granted by Foreign Investment Promotion Board.
 
The extent of contravention on the said count is Rs 578.54 crore, the ED said.
 
The ED also charged Devas Multimedia with contravening the FDI regulations under FEMA for assuring foreign investor an annual eight per cent priority dividend in addition to other dividends on cumulative basis.
 
The investments received by the Indian company with such assured returns is Rs 571.72 crore, the statement said.
 
According to the ED, Devas, for one tranche of receipt of funds, issued a security akin to an External Commercial Borrowing (ECB) promising higher returns than the ceiling fixed by the Reserve Bank of India. The extent of violation is Rs 67.5 crore, the ED said.
 
According to the probe agency, a show cause notice has been issued to the Indian investors, the persons responsible in the Indian company, including its directors and foreign investors.
 
The ED has initiated adjudication process. In case the alleged contravention is proved in the adjudication proceedings, the noticees are liable for penalty under FEMA, which may be imposed up to thrice the sum involved in such contravention.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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Government not planning strategic sale of IDBI Bank
The government on Tuesday denied it is considering any proposal of strategic sale, involving surrender of majority ownership, of state-run IDBI Bank.
 
Minister of State for Finance Santosh Kumar Gangwar in response to a query on the matter told the Rajya Sabha in a written reply that the government is not considering any proposal of strategic sale in IDBI.
 
The central government held 73.98 per cent shares in IDBI Bank, and state-run Life Insurance Corp held around 14.37 per cent of the shares, as on March 31, 2016.
 
Noting, however, that state-run banks, including IDBI, have been allowed to raise capital through follow-on public offers or qualified institutional placements, Gangwar said this could result in dilution of "government holding (in banks) up to 52 per cent in a phased manner based on their capital requirement, their stock performance, liquidity, market conditions etc."
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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Pankaja Munde using Delhi-registered Range Rover in Maharashtra without paying taxes: AAP
Pankaja Munde Palwe, the Minister of Rural Development, Women and Child Welfare in Maharashtra is using a vehicle with red beacon that is neither registered in the state nor any tax was paid on this, alleges Aam Admi Party (AAP).
 
In a release issued on Tuesday, Preeti Sharma Menon of AAP has alleged that the minister uses a private vehicle, which is a Range Rover with license plate DL 12 CD 1212, with a red beacon. "This (the vehicle) is registered in Delhi under the name of Radico NV Distilleries, which is an Aurangabad-based company where the minister's husband, Charudatta Palwe is a Director", says the release.
 
 
"While Ms Munde Palwe can easily afford an expensive vehicle, what she cannot afford is to pay state taxes," said the AAP. With an AAP government in Delhi, it has had the access to do some more sleuthing as well.  "We wrote to the Delhi Transport Ministry and discovered that there is no application filed for obtaining a no objection certificate (NOC) for transferring the vehicle to Maharashtra."
 
 
"If a common citizen were to continually use a vehicle registered in another state, without transferring the vehicle and without paying state taxes, there would be swift action against him or her. But our high profile Minister Ms Pankaja Munde is avoiding state taxes by openly plying a Delhi registered vehicle on a continuous basis in Maharashtra, without paying Maharashtra taxes, and with an illegal red beacon to top it all, the AAP alleges.
 
Making the usual political charges against the Bharatiya Janata Party (BJP) government, AAP says, it has written a complaint to the Transport Commissioner Shyam Wardhane and Maharashtra Chief Minister Devendra Fadnavis.

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COMMENTS

Rajesh Kumar

7 months ago

it should be better to change the laws if one pays taxes for private vehicle in a state, he / she should be allowed to run the vehicle in any where in india if he/she does not use it for commercial purpose. Laws should be changed . it will give very relief to common man. there is no room for roaming in the present situation.

Rajesh Kutriyar
Patna

Cyrus Engineer

7 months ago

Private motor vehicles have all India permit. Why should she re register her vehicle when ownership is not changing.

Jagrati

7 months ago

It exposes AAP also.. Delhi seems to be lowest taxed location for diesel/vehicle. Why odd even .. ?

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