The verdict against Antrix Corporation, the commercial arm of the Indian Space Research Organisation, by the Permanent Court of Arbitration tribunal in The Hague is yet another example of how its dispute with Devas Multimedia has been mishandled by the Centre from day one. As a sovereign state, India has the right to cancel agreements and licences given to private entities if it concludes that there are irregularities or gaps in the manner in which they were inked. The Supreme Court’s verdict in the 2G spectrum and coal block allocation scams highlights this in no uncertain terms. That the agreement between Antrix and Devas over use of spectrum and lease of transponders was flawed has been reiterated by several independent agencies. For instance, the report of the High Powered Review Committee comprising B.K. Chaturvedi, Member, Planning Commission, and Professor Roddam Narasimha, Member, Space Commission — appointed on February 10, 2011 — reflects several concerns. The Cabinet Committee on Security, based on an internal inquiry, faulted the deal on technical, commercial, managerial and financial grounds. A one-man committee appointed by the Department of Space also found loopholes in the drafting of the contract.
Despite such documentary evidence in support of scrapping the deal, it is baffling how India’s legal hawks failed to defend its position effectively. A reading of the final award of the International Court of Arbitration (International Chamber of Commerce) given in September 2015 reveals that Antrix may have conceded too much ground to Devas Multimedia by failing to nominate an arbitrator or have a say in fixing the terms of reference for the arbitral tribunal. The ICC ruling, which ordered Antrix to pay $672 million to Devas, reveals Antrix did not even send its nomination for the three-member arbitration tribunal to the ICC. Rather, it chose to petition the Supreme Court to start separate arbitration against Devas, a plea that failed. Antrix wrote to the court raising concerns about the appointment of one of the members on the panel but did not pursue the matter; no further challenge was made despite the ICC asking it to file an appeal under relevant rules. On several other occasions Antrix did not turn up for the initial proceedings, including a preliminary conference that was held to discuss draft terms of reference. It is also not clear why the Centre used the force majeure clause in the agreement to cancel the deal. Instead, the findings of the various committees could have been used to establish that facts related to the deal were misrepresented and not fully disclosed to the entire chain of decision-makers. The Centre can still make changes to its legal strategy when Devas comes after it to enforce the arbitration award.