Devas Multimedia shareholders will continue to seize Indian overseas assets


Unmoved by the Supreme Court ruling upholding the company’s liquidation, Devas Multimedia shareholders will continue to seek the seizure of Indian government assets overseas to raise $1.2 billion. to settle the matter, their lawyer said.

“The Supreme Court decision does not change anything. The Modi government and the Indian courts cannot rewrite the facts. Their slight allegations of fraud will never stand up in courts outside India,” said Matthew D McGill, partner at Gibson, Dunn. & Crutcher, and lead counsel for several Devas shareholders. “A better approach for the Modi government would be to return to the negotiating table and continue the settlement talks.”

Devas shareholders are suing Indian assets overseas to recoup the rewards and won a French court order to freeze Indian properties in Paris and obtained partial rights to funds maintained by Indian funds in Canada.

“We have already secured liens or obtained seizure and garnishment orders on tens of millions of dollars of Indian state assets,” a Devas Multimedia spokesperson said. “We will continue to identify and seize state assets wherever we find them until India returns to the negotiating table in good faith.”

As well as securing a Paris property freeze from the Indian government, they secured an order from a Canadian court for the seizure of around $23 million that Air India had with IATA, the gatekeeper said. -word.

Last week, Finance Minister Nirmala Sitharaman said the government would use the Supreme Court’s ruling calling the 2005 Antrix-Devas deal a fraud to counter the seizure of its overseas properties.

“The strategy of the Modi government is not rocket science. They will use the Supreme Court decision to uphold the winding up order of the NCLT to attack Devas, worldwide, however, we are ready. Courts around the world will see through these sham procedures,” the spokesperson said.

Antrix Corporation, the government-owned commercial arm of the Indian Space Research Organization (ISRO), has signed an agreement with Bengaluru-based Devas Multimedia for a 12-year lease of 90% transponder space on two satellites , G-SAT6 and G-SAT6A which had not yet been launched.

Of the 150 MHz of space that ISRO had in the S-band spectrum, Devas was allowed to use 70 MHz to launch satellite applications on mobile devices. Devas, which had a few former ISRO scientists in its leadership, was supposed to pay $300 million to Antrix over a 12-year period.

The deal was called off in 2011 after allegations that it was a quid pro quo “love deal” surfaced. In 2014, the CBI and the Enforcement Directorate were asked to investigate the deal.

Last year, Antrix contacted the National Company Law Tribunal (NCLT) to seek liquidation of Devas. NCLT ordered the liquidation of Devas on the observation that the company appeared to have been incorporated with fraudulent intentions. Devas appealed to the NCLAT which, in September 2021, upheld the liquidation. Devas appealed to the Supreme Court, which last week upheld the NCLAT’s winding-up order.

Devas Multimedia has launched an arbitration against the cancellation of the 2005 agreement with the International Chambers of Commerce (ICC). Two separate arbitrations have also been initiated under the bilateral investment treaty (BIT) by the Mauritian investors of Devas Multimedia under the India-Mauritius BIT and by Deutsche Telekom, a German company under the India-Germany BIT . India lost all three disputes.

The trade terminal award was for a total of $1 billion, while India was awarded $93.3 million plus costs and interest in the BIT arbitration. India-Germany, Sitharaman said last week. About $111.2 million plus costs and interest was awarded in the India-Mauritius BIT arbitration.

She had accused the then Congress-led UPA government of entering into a “fraud agreement” and allocating the scarce S-band spectrum for a “derisory”.

When asked if Devas shareholders weren’t following the successful script of Britain’s Cairn Energy, which identified $70 billion in Indian overseas assets and began foreclosures in July 2021 starting with the same property Parisian government and targeting Air India to recover USD 1.2 billion that an international arbitration tribunal had awarded the collection of retroactive taxes, the Devas spokesman said the Cairn case had nothing to do with Devas.

“The Cairn case has nothing to do with Devas. Cairn has dropped its challenges as part of its settlement with the government. Devas shareholders will continue to enforce the arbitration judgments until they are The Modi government was right to settle with Cairn because there is no point in continuing to evade payment of arbitral awards which have been upheld in any case,” the spokesperson said.

In August last year, the government enacted new legislation to remove all retroactive tax demands made on companies such as Cairn Energy and agreed to refund monies collected to enforce this demand. Cairn is entitled to a refund of Rs 7,900 crore as a result of this.

Devas’ spokesperson said they can register the arbitral awards they have obtained anywhere in the world.

(Only the title and image of this report may have been edited by Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)


About Author

Comments are closed.