Accusing Tata Group of not willing to pay USD 1.17 billion compensation, Japan's largest mobile phone firm NTT DoCoMo today said RBI disallowing its "mischaracterised" application does not bar the Indian group from paying out of funds or assets outside the country.
Accusing Tata Group of not willing to pay USD 1.17 billion compensation, Japan’s largest mobile phone firm NTT DoCoMo today said RBI disallowing its “mischaracterised” application does not bar the Indian group from paying out of funds or assets outside the country.
Tata Sons last month was ordered to pay DoCoMo USD 1.17 billion in compensation for breaching an agreement on India joint venture.
DoCoMo in a statement said Tata Sons was citing Reserve Bank of India (RBI) not granting an exemption to the foreign exchange act to pay the money as an “excuse”.
“By definition that decision only relates to payment of hard currency out of India. It cannot be used to block payment from funds or assets outside India nor can it prevent enforcement against such assets of Tata outside India,” the Japanese firm said.
Keen to get the USD 1.17 billion quickly, NTT Docomo got an ex parte order from the Commercial Court in London seeking permission to enforce the award in the UK. It essentially meant seizing Tata’s Britain assets to recover the money.
Tata Sons yesterday said it has 23 days from July 27 to apply for the order to be set aside.
The Japanese firm has also filed a plea in the Delhi High Court seeking enforcement of the arbitration ruling.
DoCoMo said it notes yesterday’s statement by Tatas committing to honour its contractual obligations and settle the arbitration award. “DoCoMo also wishes that outcome,” it said.
“The only excuse for non-payment of the award which is alleged by Tata is the decision by the Reserve Bank of India earlier this week which was based on a mischaracterised application unilaterally made by the Tata without first consulting its partner DoCoMo,” the statement said.
DoCoMo said it “does not think that Tata Sons has in truth shown its willingness to make the payment.”
Yesterday, Tata Sons had said the arbitral award cannot be forced by seizing its Britain assets till the end of the 23 day period granted by the London Commercial Court or until any application made by it has been finally decided upon.
“Further, the British assets of Tata Steel and Jaguar land Rover are not owned by Tata Sons. These are subsidiaries of Indian public listed companies of which Tata Sons is a promoter with a minority shareholding of not more than 30-35 per cent,” it had said.
Tata Sons also said that these firms were not party to the arbitration proceedings and so no award has been issued against them.
The arbitral award is the result of a two-year tussle between the partners in their failed joint venture Tata Teleservices in which NTT Docomo of Japan holds 26 per cent stake which it had picked up in November 2008 for USD 2.7 billion or about Rs 12,770 crore at the then exchange rate.