The Central Bureau of Investigation (CBI) has registered a case against a former executive director of Antrix Corporation, the commercial arm of Indian Space Research Organisation (ISRO), and officials of Bengaluru-based private firm Devas Multimedia in connection with the leasing of satellite spectrum or S-band, a deal which the government had annulled in 2011.
“It is alleged that then Executive Director of Antrix Corporation Ltd in conspiracy with other unknown officials of Antrix Corporation/ISRO/Department of Space and Bengaluru based company had cheated the Government of India and caused favours to the said company,” said a CBI press release on Wednesday. “The accused public servants had allegedly given the rights to an ineligible company of Bengaluru for delivery of video, multimedia and information services to mobile receivers in vehicle and mobile phones via S-Band through GSAT-6 and GSAT-6A satellites and terrestrial systems in India. An alleged loss of Rs 578 crore (approx) was caused,” the release said.
In January 2005, Antrix had entered into an agreement with Devas Multimedia to lease transponders over 12 years for about $300 million. The Centre had annulled the deal in February 2011 after the Cabinet Committee on Security ruled that S-band spectrum was a strategic asset and could not be used for commercial activity. Subsequently, Devas initiated an arbitration suit at the International Court of Arbitration for annulling the contract.
According to the CBI, there is also an accusation that information regarding the agreement between Antrix and Devas was suppressed from the Cabinet and that `wrong information regarding utilisation of satellite capacity’ was given to the cabinet.
“It is also alleged that Bengaluru based company had submitted false, wrong and incorrect information claiming that it had the technology and was fully capable of delivering the S-DMB services to get the rights of delivering same in India through PS1 and PS2 and consequently, Bengaluru based company allegedly got wrongful gain of more than Rs 578 crore (approx) from various investors from USA, Mauritius, Singapore etc,” the release said. “The Bengaluru-based private company with the intent to siphon off the amount from its bank accounts in India, got a subsidiary in another name incorporated in USA and a substantial part of wrongful gain was remitted to this new company of USA on the pretext of services, salaries, etc. The illegal gratification was allegedly paid to the accused public servants.”
In February 2011, the government had set up a two-man committee comprising former cabinet secretary B K Chaturvedi and Space Commission member Roddam Narasimha to review the procedures and approval processes followed by Isro and its commercial arm Antrix and suggest improvements. Subsequently it had also set up a high-level team headed by former Central Vigilance Commissioner Pratyush Sinha to review the Antrix-Devas agreement.
The case registered by CBI also includes an allegation that a change in the board of directors of Devas had taken place after the agreement deal had been signed. “This change was never checked and verified by officials of Antrix Corporation. Further, when a proposal seeking budgetary support of Rs 269 crore (approx) for approving design, manufacture and launch of GSAT-6/ INSAT-4E (PS1) was placed in the 104th meeting of the Space Commission on May 26, 2005, it was not informed that the agreement had already taken place with Bengaluru based company for leasing out the S-Band,” the CBI release said.