Supreme Court Affirms Winding Up Of Devas Multimedia On Plea Of ISRO Arm Antrix

The Supreme Court on Monday dismissed an appeal filed by Devas Multimedia challenging the orders passed by the NCLT and NCLAT allowing the winding up of the company on a petition filed by ISRO's commercial arm Antrix Corporation Ltd.A bench comprising Justice Hemant Gupta and Justice V Ramasubramanian dismissed the appeals filed by Devas Multimedia and its shareholder Devas Employees Mauritius Pvt Ltd. It was on January last year that the National Company Law Tribunal, Bengaluru, admitted the petition filed by the Indian Space Research Organization's commercial arm Antrix Corporation Ltd to wind up Devas Multimedia under Sections 271 and 272 of the Companies Act 2013. The NCLT also appointed a provisional liquidator for Devas Multimedia after making a prima facie observation that its incorporation was done in a "fraudulent manner" and that it had "resorted to various frauds, misfeasance, connivance with officials in obtaining contract dated 28.01.2005 from Antrix".In January 2021, the Central Government had authorized Shri.Rakesh Shashibhushan, Chairman-cum-Managing Director of Antrix to present a petition to wind up Devas multimedia on the grounds specified under Section 271(1)(c) of the Companies Act.In May, the NCLT Bengaluru bench ordered the winding up of Devas observing that it was incorporated in a "fraudulent manner to carry out unlawful purposes" and its management resorted to "fraudulent activities" in relation to the commercial contract with Antrix.In September 2021, the National Company Law Appellate Tribunal upheld the NCLT's order of winding up.In 2011, the Devas-Antrix agreement of 2005 was annulled by the Centre in the backdrop of the 2G scam and allegation. On October 27, 2020, a federal court in the US had confirmed a $1.2 billion compensation awarded to Devas by an arbitration tribunal of the International Chamber of Commerce over the cancellation of the 2005 agreement between Antrix and Devas to build and launch two satellites to provide multimedia services. The Supreme Court of India had in November, until further orders, kept in abeyance the implementation of the US federal court order.Taking a dim view of the proceedings initiated by Devas in the international forum against Antrix, the NCLT said that Devas "in all its fairness" should have waited for the outcome of the proceedings pending against the validity of the award before attempting to enforce the same.The NCLT observed :"When Antrix and Union of India have suffered huge ICC Award and are facing its enforcement proceedings, Devas, in all fairness, it should wait for the outcome of proceedings pending before Hon'ble Delhi against the validity of the Award. Therefore, this Tribunal would not permit Devas to succeed at both ends and its bounden duty is to protect public interest and to uphold the law. Since Devas is misusing the legal status conferred on it by virtue of its incorporation by filing various proceedings on un-tenable grounds in India and abroad to enforce ICC Award, it would be just and proper for this Tribunal to decide matter as expeditiously as possible"Detailed report on judgment may be read here : If Fraudulent Affairs Of Company Are Continuing, Right To Seek Winding Up Becomes Recurring : Supreme Court In Antrix-Devas Case Case Title : Devas Multimedia Private Ltd vs Antrix Corporation Ltd and anotherCitation : 2022 LiveLaw (SC) 57Appearances: Senior Advocate Mukul Rohatgi for Devas, Senior Advocate Arvind P Datar for Devas Employees Mauritius Pvt Ltd, Additional Solicitor General N Venkataraman for Antrix, Additional Solicitor General Balbir Singh for Union GovtClick here to read/download the judgment

Supreme Court Affirms Winding Up Of Devas Multimedia On Plea Of ISRO Arm Antrix

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