19 March 2015

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Antrix-Devas deal Rs 578 crore wrongful gain CBI registers case against former ED

Antrix-Devas deal Rs 578 crore wrongful gain CBI registers case against former ED

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 Organization (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.

'Devas got Rs. 578 cr. via favors from Antrix'

Those facing allegations of cheating, conspiracy and corruption are
Then Antrix executive director K.R. Sridhara Murthi,
R. Vishwanathan and M.G. Chandrasekhar (former ISRO scientist) of Forge Advisors LLC, USA;
And Bengaluru-based Devas Multimedia,
Besides unknown officials of Antrix, ISRO and Department of Space.

The Central Bureau of Investigation has registered a case U/s 120-B, 420 of IPC and Section 13(2) r/w 13(1)(d) of PC Act, 1988 against the
Then Executive Director, Antrix Corporation Limited, Bengaluru;
Two officials of USA-based Company;
Bengaluru based private multimedia company
And other unknown officials of Antrix Corporation Limited /ISRO/Department of Space.

It is alleged that then Executive Director of Antrix Corporation Ltd in conspiracy with other unknown officials of Antrix Corporation Limited /ISRO/Department of Space and Bengaluru based company had cheated the Government of India & caused favors to said company.

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 crores (approx.) was caused

 It is further alleged that an agreement between Antrix Corporation Limited and Bengaluru based private company was signed on January 28, 2005 for the lease of 10 S-band Transponders for the said services.

On behalf of Antrix Corporation Limited, the then ED signed the said agreement. After the agreement, the two Advisors of said USA based company were appointed as Directors of Bengaluru based company.

There was also change in the Board of Directors of Bengaluru based company and both the Advisors, through USA based company, took over the charge & control of Bengaluru based company which was against the spirit of Shankara Committee that recommended for agreement to be executed with an Indian company.

This change was never checked and verified by officials of Antrix Corporation Limited. Further, when a proposal seeking budgetary support of Rs. 269 crores (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.

It is also alleged that a note for the Cabinet was submitted for building the GSAT 6 satellite as earlier approved by the Space Commission. Information regarding the agreement between Antrix Corporation Limited and Bengaluru based company was suppressed from the Cabinet and the wrong information regarding utilization of satellite capacity was given to the Cabinet with respect to multiple expressions of interest, though the agreement was signed with Bengaluru based company without any multiple expressions of interest.

The proposal was approved by the Cabinet in December 2005. After coming to know the omissions and commissions on the part of the accused persons, the agreement dated 28.01.2005 was annulled by Antrix Corporation Limited in accordance with the decision dated 17.02.2011 of Cabinet Committee on Security (CCS).

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 crores (approx.) from various investors from USA, Mauritius, Singapore etc.

The two Advisors were allegedly beneficiaries of above said transactions, besides others. 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.

Suggested Reading

Corruption in ISRO – S band Scam – Scam Amount 2 Lakh Crore – CAG Expose

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Thursday, March 19, 2015

Tags - Antrix-Devas Scam Rs 578 crore wrongful gain CBI