Antrix ruling: shabby work by govt, Isro

The verdict of the Permanent Court of Arbitration tribunal in The Hague against Antrix Corporation, the commercial arm of the Isro, is a setback to that organisation and an embarrassment to the Indian government. The tribunal has ordered payment of a huge amount of compensation to the foreign shareholders of Devas Multimedia, a company which had entered into a contract with Antrix over the use of spectrum and lease of transponders. The compensation was for unfair and inequitable violation of contract. Last year, another tribunal had ordered Antrix to pay $ 672 million (Rs 4,435 crore) to Devas. The two orders impose a heavy financial burden on Antrix. The likely financial loss and the embarrassment are the result of a series of mistakes and lapses in official decision-making by the Isro authorities and the government. This is clear at all the three stages of the matter – the signing of the contract, its cancellation and the response to the arbitration proceedings.

The original deal was for long-term lease of trans-ponders in two Isro satellites and to provide 70 MHz S-band spectrum to Devas, a company promoted by former Isro personnel. The agreement was signed in 2005 when G Madhavan Nair was the chairman of Isro and the head of Antrix. It came into limelight along with the 3G spectrum allocation scandal. The CAG and two official committees which scrutinised the deal found it wrong on many grounds like violation of rules and procedures and causing loss to the exchequer. It was considered to have benefited a private party at the cost of public interest. While the agreement was wrong, its cancellation in 2011 when K Radhakrishnan was the chairman of Isro was also done wrongly, without invoking the best and strongest grounds.

The care and application needed to handle the legal issues involved in cancelling a contract and to foresee its consequences were not in evidence when the deal was cancelled. If the signing of the agreement and its cancellation were marked by mistakes, the way the arbitration proceedings were handled, after they were initiated by Devas, was equally wrong. Antrix first went to the Supreme Court on the matter. That did not work. Even when it was known that it had to face arbitration proceedings, it did not nominate an arbitrator and did not participate fully in the proceedings. Intentional wrongdoing, wrong motives, indifference or lack of vigil may have been involved in varying degrees in the decisions at every stage. It is reported that the government may appeal the tribunal order. While legal remedies should be explored, those who took the wrong decisions or implemented them wrongly should be held accountable.