Read Time: 04 minutes

Synopsis

The Delhi High Court on Friday upheld a single-judge bench order setting aside the arbitral award passed in 2015 against Antrix Corporation Ltd. (the commercial arm of ISRO) to pay damages of over US$ 560 million along with interest to Devas Multimedia Pvt. Ltd.

The Division Bench of Chief Justice Satish Chandra Sharma and Justice Subramonium Prasad while dismissing a plea filed by satellite services provider Devas Multimedia to challenge the award passed by International Arbitration Court said it is ‘well established’ that Devas was incorporated with fraudulent intentions so that it could enter into an agreement with Antrix.

"The learned single-judge has not made an error in setting aside the ICC Award on the grounds of fraud and it is in conflict with the public policy of India. Accordingly, the challenge to the judgment by the appellant, on the ground that the Ld. single-judge could not consider the grounds of public policy and fraud under Section 34,” the court said.

The dispute relates to Devas’s suit against Antrix Corporation Limited, the commercial arm of India’s space agency Indian Space Research Organisation (ISRO), which scrapped a deal for the former to offer multimedia services via two satellites to be deployed by the space agency.

Antrix and Devas were engaged in a contract whereby Antrix promised to construct, operate, and launch two satellites and to lease spectrum capacity on these satellites to Devas. Devas was required to utilise this bandwidth to offer multimedia services throughout India.

On the basis of a petition submitted by Antrix, the National Company Law Tribunal (NCLT) and the National Company Law Appellate Tribunal (NCLAT) had ordered the dissolution of Devas for fraud. Devas appealed the NCLAT's decision before the Supreme Court, which, on January 17 of last year, upheld the ruling that Devas was founded for fraudulent and illegal purposes.

The division bench held that it saw “no perversity” in the findings of the single judge on the grounds of fraud which was in conflict with the public policy of India.

Case Title: Devas Employees Mauritius Pvt. Ltd. vs. Antrix Corporation Ltd. & Ors.