M A I N   N E W S

Govt annuls deal between Antrix, Devas
Girja Shankar Kaura
Tribune News Service

New Delhi, February 17
A day after Prime Minister Manmohan Singh defended himself of any wrongdoing in the controversial deal regarding the allocation of S-band Spectrum between ISRO’s commercial arm Antrix and Bangalore-based firm Devas Multimedia Private Limited, the government today moved ahead to terminate the deal.

The decision to annul the deal was taken at the meeting of the Cabinet Committee on Security (CCS) held this morning. The meeting was chaired by Prime Minister Manmohan Singh at his residence.

the deal
ISRO’s commercial arm Antrix and Bangalore firm Devas Multimedia Private Limited entered into an agreement in 2005 for handing over 70 MHz of S-band Spectrum to the private firm for Rs 1,000 crore.

the row
Citing the government auditor’s findings, media reported that the agreement had resulted in a loss of Rs 2 lakh crore to the nation.

govt stand
Having regard to the needs of the country’s strategic requirements, the government will not be able to provide orbit slot in the S-Band to Antrix for commercial activities. The government is confident of facing any legal suit and claims that Devas is not likely to succeed.

Devas’ reaction
We are still awaiting a formal communication from the Government of India on the status of our contract. Once we get this information, we will be in a position to comment.

The annulment comes in the wake of a raging controversy over the deal for handing over 70 MHz of S-band Spectrum to the private firm for Rs 1,000 crore on which the CAG has already initiated action.

The move came a day after Devas Multimedia said it “will take strong, including legal, steps” if its accord with the Indian space agency on allocation of S-band Spectrum was annulled.

Addressing the media after the meeting of the CCS, Union Law Minister Veerappa Moily said, “The government took note of the fact that the S-band Spectrum is meant for strategic interest, security and societal needs so it cannot afford to give S-Band Spectrum for commercial activities.”

Defending the Prime Minister and his Cabinet colleagues, Moily said, “The government and Dr Manomhan Singh are not at fault.”

In a statement issued here, the government said, “Taking note of the fact that government policies with regard to allocation of Spectrum have undergone a change in the last few years and there has been an increased demand for allocation of Spectrum for national needs, including for the needs of defence, paramilitary forces, railway and other public utility services as well as for societal needs, and having regard to the needs of the country’s strategic requirements, the government will not be able to provide orbit slot in the S-Band to Antrix for commercial activities, including for those which are the subject matter of existing contractual obligations for S-Band.” “In the light of this policy of not providing orbit slot in the S-Band to Antrix for commercial activities, the ‘agreement for the lease of space segment capacity on ISRO/Antrix S-Band spacecraft by Devas Multimedia Private Limited’ entered into between Antrix Corporation and Devas Multimedia Private Limited on January 28, 2005, shall be annulled forthwith,” the statement said.

The Bangalore-based company had yesterday reiterated that it “has a legally binding agreement with the Department of Space/Indian Space Research Organisation/Antrix (ISRO’s commercial arm)”.

“Devas has not elected to terminate the agreement despite DOS/ISRO/Antrix being in material breach. Devas expects the government to fulfil all its obligations under the agreement and will take strong, including legal, steps to protect the company’s rights and interests,” the firm said in a statement.

The deal is said to have caused a loss of billions of rupees to the exchequer though both the government and the ISRO have denied it, pointing out neither transponders have been allotted to Devas nor any radio waves sanctioned for the firm yet.

Sounding confident of the legal options to go in government’s way, the Law Minister said, “The government is confident of facing any legal suit and the Devas is not likely to succeed.” When asked to give details about further action by the Centre, Moily said, “Let the Chaturvedi Committee report come and then further action will be taken.”

During the meeting, the CCS decided to go with the recommendations of the Department of Space to scrap the contract awarded to Devas Multimedia.

The government is now likely to follow the due legal procedure for the annulment of the contract awarded to the firm. Prime Minister Manmohan Singh, while interacting with the editors of the electronic media yesterday had indicated that the controversial deal between Antrix and Devas Multimedia had never been operationalised and the CCS would soon decide on terminating it.

He also rejected any suggestions that his office had held “backroom” talks with Devas after the Space Commission’s decision to scrap the deal and said any delay in implementing it was “procedural”.

Earlier, Devas Multimedia had termed as “disturbing and inappropriate” the government’s “unilateral” decision to terminate the agreement “without due investigative process and without following the principles of natural justice”.

“We have grave concerns regarding the government’s statement today on premeditated annulment of the agreement, despite pending high-power committee and CAG (Comptroller and Auditor-General of India) reviews which are still in the preliminary stages,” the company’s statement said.




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