More reports on: Antrix Corporation , Indian Space Research Organisation, Aerospace

India lost Antrix-Devas case over a cabinet press note, says report

07 September 2016

India might have lost the Antrix case at the Permanent Court of Arbitration (PCA) at The Hague due to a crucial press release issued by the central government on 17 February 2011 announcing the annulment of the agreement between Antrix and Devas, says a report.

The report bases its argument on a press note issued after a meeting of the Cabinet Committee on Security on 17 February 2011, which stated that the agreement was being cancelled due to considerations beyond national security.

The deal was cancelled due to ''The needs of defence, para-military forces and other public utility services as well as for societal needs, and having regard to the needs of the country's strategic requirements...,'' a report in the BusinessLine quoted from the press release.

The report, which bases itself on a copy of the final ruling of the tribunal, says that the court relied heavily on the wording of the press note to rule that the agreement between Antrix and Devas was scrapped on considerations beyond national security.

Antrix cancelled a contract for building two satellites for Devas Multimedia, a satellite-based communications service provider, in 2011, which led to the dispute between the two.

The tribunal, in its 25 July 2016 ruling, held that the expressions ''strategic needs'' or ''strategic requirements'' covered a range of activities that went far beyond the military or paramilitary sectors or the ''essential security interests'' of India.

''This, in effect, poured water over India's stand that the deal was scrapped only due to national security. Under international arbitration rules, if a state properly invokes a national security exception under an investment treaty, it cannot be liable for compensation of damages, going forward,'' says the report.

Also, according to the order passed by the court in The Hague, India failed to push for this exception by not producing key officials who dealt with the case, including K Radhakrishnan, who was the chairman of the Space Commission between 2009 and 2011, G Balachandran, then additional secretary, Department of Space, or Geeta Varadhan, director of Special Projects at the Department of Space.

''The tribunal did not have the benefit of testimonies from senior officials who were directly involved in the process leading to the CCS decision of February 17, 2011 ... who appear to have had long exposure to the needs of the military concerning the S-band,'' the report quoted from the order.

Devas, on the other hand, produced a number of witnesses and experts to prove its case that the Indian government backtracked in implementing the agreement on the allocation and management of spectrum.

India had produced numerous records and communications to show that there was demand for S-band spectrum from various segments of the armed forces even before the 2005 deal with Devas, but decided to continue with the signing of the deal, keeping Devas in the dark about this requirement.

''The evidence shows that right up to February 8, 2011, the claimants (Devas) were completely left in the dark about the Space Commission's decision and the alleged growing needs of the military and their possible impact on the Agreement,'' the tribunal ruled.

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