$1.2B damage order against Antrix was issued by lower court: Key official

India’s Department of Space (DoS) is maintaining a studied silence on the recent US court decision ordering Antrix Corporation to pay $1.2 billion as damages to Bengaluru- based Devas Multimedia.

However, a senior official in the space sector is unperturbed saying that earlier an order against Antrix issued by a lower court in France was asked by the country’s apex court to take a relook.

According to reports reaching here, the US District Court, Western District of Washington ordered Antrix to compensate Devas to the extent of $562.5 million coupled with the interest rate the total damages comes to about $1.2 billion.

Devas Multimedia had filed a case against Antrix for damages it suffered owing to the cancellation of the agreement to use two satellites (GSAT-6 and GSAT-6A) for high-speed beaming of video content on mobile devices on the S-band spectrum in February 2011.

The two companies had entered into an agreement in 2005. Devas was promoted by few former employees of ISRO.

The then UPA government cancelled the controversial contract in February 2011, invoking sovereignty and decided to use the advanced satellite (GSAT-6 and GSAT-6A) for the country’s strategic use.

Several attempts by IANS to reach DoS Secretary and Chairman, Indian Space Research Organisation (ISRO) K. Sivan to get his reaction went futile.

Reacting to the recent legal development, a senior official on the condition of anonymity told IANS: “The order has been issued by the lowest court in the US and there are higher courts.”

“In France a lower court ordered against Antrix and in favour of Devas. The matter went up to the apex court in France. The apex court sent back the case to the lower court to take a relook,” the official said.

According to the official, the US court decision is applicable within the US and if we have assets and contracts. Antrix does not have any business dealings in the US now.

Under the annulled deal, Antrix was to lease transponders of two 2-ton satellites to Devas for allowing it to offer digital multimedia services using the S-band wavelength (spectrum), reserved for strategic purpose.

The space agency, however, launched the controversial satellites (GSAT-6 and GSAT-6A) on August 27, 2015 and March 2018, respectively, from its spaceport at Sriharikota in Andhra Pradesh, about 90 km north of Chennai, as a communication satellite, using a heavy rocket.

While the launch of GSAT-6 satellite was successful, the communication link with GSAT-6A was lost soon after it was launched.

Under the controversial deal, the Bengaluru-based Devas was to use the transponders of GSAT-6 and GSAT-6A in the crucial S-Band wavelength (that was primarily kept for the country’s strategic interests) for its digital multimedia service for 12 years.

Antrix had signed the $300-million contract with Devas in January 2005 and obtained sanction of the Space Commission and the Union Cabinet for the two satellites (GSAT-6 & GSAT-6A) without informing the government that the bulk capacity (90 percent) would be leased to the multimedia service provider.

When the controversy broke in December 2009, the state-run ISRO ordered a review of the deal and subsequently the Space Commission had recommended its annulment on July 2, 2010. Antrix terminated the deal on February 25, 2011.

Subsequently the Central Bureau of Investigation (CBI) and Enforcement Directorate (ED) entered the scene to probe the deal.

The International Court of Arbitration in its September 2015 award asked Antrix to pay damages amounting to $672 million (Rs 4,432 crore) to Devas for “unlawfully” terminating the deal in 2011 citing national security reasons.

The ED in 2019 imposed a Rs 1,585 crore penalty on satellite services provider Devas Multimedia Ltd, its directors and foreign investors for illegal foreign investment of Rs 579 crore against the Foreign Exchange Management Act (FEMA) 1999.

In July 2019, the ED had attached properties worth Rs 3.10 crore of Devas under the Prevention of Money Laundering Act (PMLA).

The ED on February 28, 2017 attached the company’s properties valued at about Rs 80 crore for their alleged involvement in money laundering and prosecution complaint filed in the designated PMLA special court in the city, with a prayer for punishment to the accused and confiscation of their attached properties.