Special bench to hear Swamys plea against AirAsia, Tata-SIA

Written by Kaushal shroff | New Delhi | Updated: May 2 2014, 10:23am hrs
The Delhi High Court on Thursday said it will constitute a special bench to hear the plea of BJP leader Subramanian Swamy and Federation of Indian Airlines (FIA) seeking a stay on the commencement of operations of two new aviation ventures, namely, AirAsia and Tata-SIA Airlines.

The special bench will hear the matter on July 11.

Earlier in April, FIA had moved the court against the Foreign Investment Promotion Board (FIPB) and aviation ministry approvals granted to the new joint venture between the the Tata Group and Singapore Airlines called Tata-SIA.

FIA is an airlines lobby group that represents Jet Airways, GoAir, SpiceJet, IndiGo and Kingfisher Airlines, which had earlier filed a petition in the Delhi High Court against the approvals granted to AirAsia as well.

The High Court on April 23 allowed Swamy's plea seeking to implead DGCA as a party to a PIL, seeking quashing of approvals being granted by the Centre to operationalise the $300-million deal between Tata Sons and Malaysia-based AirAsia.

Swamy had also sought initiation of contempt proceedings against an official of finance ministry for allegedly making false statement in a reply filed on behalf of the Centre on October 25 last year.

He claimed that the official had stated that issues of "substantial ownership" and "effective control" of the airline prior to grant of approval for FDI were to be decided by DGCA.

However, DGCA had in its February 21 public notice said that FIPB is the competent authority to decide the same and it had examined these issues and taken a decision in April 2013.

Swamy said that based on the false statement of the official, the high court refused to grant him any interim relief.

Swamy and FIA are opposing clearance to the deal on the grounds that according to government policy, foreign direct investment (FDI) up to 49% is allowed in existing airlines and not to new or proposed joint ventures.

Swamy has alleged the $30-million joint venture between Tata Sons and Malaysia-based AirAsia Berhad had to show before the FIPB that the airline would be essentially controlled by Indians, but this has not been done.