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NCLT admits petition for winding up of Devas

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Bengaluru: Exercising powers conferred on the National Company Law Tribunal, especially under Section 273 and other extant provisions of Companies Act, 2013, under Chapter XX, Part 1, the Bengaluru Bench of NCLT comprising of Rajeswara Rao Vittanala, Member Judicial and Ashutosh Chandra, Member Technical on Wednesday 20 January admitted the Petition by Antrix Corporation, the marketing arm of ISRO, and passed directions pending finalization of winding up of Devas Multimedia Private Limited petition.

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The bench also granted time to the petitioner and respondent Devas Multimedia, to file their Replies.

NCLT has appointed the Official Liquidator, Bangalore attached to the High Court of Karnataka at Bangalore, as Provisional Liquidator for the Respondent Company.

NCLT also has directed the existing Management of Devas to extend full cooperation to the Provisional Liquidator to carry out his duties under the extant provisions of Companies Act, 2013.

The Provisional Liquidator has been permitted to initiate appropriate action, in accordance with extant provisions of Companies Act, to take control of Management of Devas and to take custody or control all the property, effects and actionable claims to which Devas is or appears to be entitled to and take such steps and measures, as may be necessary, to protect and preserve the properties of the Company and to avoid misuse of its property.

Further, the Provisional Liquidator, has been directed to strictly adhere to the extant provisions as applicable to the instant case, as mentioned under Chapter XX. Part 1 of Companies Act, 2013 (6).

The NCLT order will be without prejudice to the Parties in the pending litigation before the High Court of Delhi and the Supreme Court of India.

The case has been posted on 8 February, 2021 for further hearing.

The petition by Antrix Corporation Limited states that the then officials’ of Antrix Corporation Limited (‘then officials’ to distinguish them from the Petitioner company and hereinafter referred to as the then officials), including its then Chairman, had executed contract dated 28/01/2005 in favour of the Respondent No. 1 Company, which was ultimately led to its termination by letter dated 25.02.2011, as it was obtained fraudulently in connivance with the then officials. Further, various Statutory Authorities have unearthed the fraud in the executing the Agreement. This fraud has been the subject matter of investigation by two premiere investigation agencies namely, the CBI and Enforcement Directorate (ED). The CBI had filed two charge sheets dated 11.08.2016 and supplementary charge sheet dated 08.01.2019. The ED had issued show-cause notice dated 06.06.2016 and 24.12.2018. Further, the adjudication order dated 30.01.2019 was passed under the Foreign Exchange Management Act, besides initiating PMLA proceedings in O.C. 703 of 2017. When the Ministry of Corporate Affairs had initiated investigation and they were proceeding to issue show cause notices to adjudicate the matter.

Government of India on 18 January had issued notification authorising Rakesh Sasibhushan, Chairman- cum- Managing Director, Antrix Corporation Limited (a Government Company) to present a petition before the National Company Law Tribunal (NCLT) for winding up of Devas Multimedia Private Limited on the grounds specified under clause (c) of Sub-section (1) of Section 271 of the Companies Act, 2013 (18 of 2013).

The petition by Antrix states that the then officials of Antrix Corporation Limited, including its then Chairman, had executed contract dated 28/01/2005 in favour of the Respondent No. 1 Company (Dewas), which ultimately led to its termination by letter dated 25.02.2011, as it was obtained fraudulently in connivance with the then officials. Further, various Statutory Authorities have unearthed the fraud in the executing the Agreement. This fraud has been the subject matter of investigation by two premiere investigation agencies namely, the CBI and Enforcement Directorate (ED). The CBI had filed two charge sheets dated 11.08.2016 and supplementary charge sheet dated 08.01.2019. The ED had issued show-cause notice dated 06.06.2016 and 24.12.2018. Further, the adjudication order dated 30.01.2019 was passed under the Foreign Exchange Management Act, besides initiating PMLA proceedings in 2017.

It is further stated in the petition that the Petitioner itself a victim of the fraud and corruption, to which its then Chairman and other officials were party, and on account thereof has suffered an Arbitral Award dated 14.09.2015, passed in Case No. 18051/CYK titled as Devas Multimedia Pvt. Ltd. Vs. Antrix Corporation Ltd. into more than half a billion dollars, which with inter 4/15 to more than a billion dollars today. The Petitioner has preferred an Application before the Hon’ble High Court of Delhi, against the impugned Arbitral Award dated 14.09.2015, and various Criminal and other penal proceedings are presently underway, under the Prevention of Corruption Act, 1988, the Indian Penal Code, 1872, the Prevention of Money Laundering Act, 2002 (‘PMLA) and the Foreign Exchange Management Act, 1997 (“FEMA), against the individuals/entities concerned, including CMD and Directors of the Respondent No. 1 company, as well as the then Secretary to the Government of India in the Department of Space, and other government officials.

Click to download NCLT order

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