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Frantic Effort in 2020 to Pass “Devas Amendment” to Arbitration Law Results in a Fraudulent Set Aside by Delhi High Court

Politics again trumped rule of law as the Delhi High Court in August unsurprisingly ruled to set aside Devas’ $1.3B international arbitration award on the bogus grounds of “patent illegality and fraud”.

The ruling handed down by Modi’s subservient judiciary is yet another in a long line of fraudulent and targeted attacks on businesses and individuals, all engineered by the autocratic regime that is methodically destroying the rule of law in India.

The judge himself acknowledged that there were “limited” grounds for a successful set aside, but still chose to bow to the domestic political winds and help the Modi regime evade its international responsibilities.

Such travesties of justice are why India repeatedly loses international arbitration cases brought in neutral venues by its victims, including Cairn Energy, Vodafone and now Devas.

In a statement following the decision, Matthew D. McGill, Lead Counsel to Devas Shareholders and Partner at Gibson, Dunn & Crutcher, called the ruling a “mockery of the international arbitration system…” and warned that “India’s courts are now willing accomplices in the government’s scheme to use baseless fraud allegations and innuendo to evade multiple international arbitration judgments”

The “Devas Amendment”

On November 4, 2020, the U.S. District Court for the Western District of Washington formally entered judgment recognizing the $1.3 billion ICC award in favor of Devas, rejecting all of India’s hollow arguments against it. That same day, the Modi government passed a “Devas Amendment” to India’s arbitration law enabling the country’s politically subservient courts to unconditionally stay any arbitration award “where a prima-facie case of fraud or corruption has been made” regarding an underlying contract, with retroactive effect.

The “surprise” amendment was immediately flagged as “suspicious” by fair-minded legal observers, who pointed out in the media the obvious motive – a frame up, so that the Delhi High Court would have a legal pretext to set aside the Devas award.

Note that no actual proof of fraud or corruption is required – only a “prima-facie” case in the eyes of a judge whose career depends upon pleasing the Modi regime.  This contrivance recalled memories of Modi’s illegal retrospective tax that targeted Britain’s Cairn Energy, which led to a $1.6 billion international arbitration award in Cairn’s favor – ultimately embarrassing the Modi regime and exposing India as a dangerous place for investors.

The “War Footing” Memo

Modi & Co. learned from the Cairn fiasco, and when the U.S. court dismissed all of India’s failed arguments and entered the Devas award on November 4, 2020, the government went on the attack.

On the same day that the government passed their “Devas Amendment” to the arbitration law, Finance Minister Nirmala Sitharaman spearheaded an inter-ministerial committee on a “war footing” to “expedite statutory proceedings” and investigations on all fronts “to reach finality and conclusion” in contrived prosecutions against Devas. Since the law now said that mere allegations of fraud would enable the court to stay an award, Sitharaman utilized agencies within her ministry, specifically the Enforcement Directorate, to fabricate such allegations.

Set Aside is Nothing More than Another Fraud

The set aside ruling handed down by the Delhi High Court represents nothing more than a contrivance, debasing the credibility of India’s judiciary merely to avoid the financial consequences of repudiating a commercial contract. 

For India, the set aside will prove to be a Pyrrhic victory. As McGill noted in his response to the Delhi High Court Ruling, the Modi regime will now face the consequences of such thuggish behavior in the form of a new arbitration claim that will expose the Indian government’s dishonesty before a new, impartial international tribunal.

Until then, McGill reminds Modi, Sitharaman and their political cronies, “Devas shareholders will not waver or be deterred from pursuing their rightful claims in every court around the world until the awards are fully satisfied.” Potential investors in India should beware that notwithstanding the country’s apparent commercial attractions, the Cairn, Vodaphone and especially now the Devas case plainly demonstrate the Modi regime’s astonishing readiness to sacrifice the country’s institutions for unfair and comparatively modest financial gains.

The Modi government was quick to start last week with what they claimed was a “Big Win” over Devas.

The Delhi High Court announced it had set aside the $1.3 billion arbitration award state-owned Antrix owes to Devas, claiming the international arbitral award is “tainted by fraud” and “contrary to the fundamental policy of the Indian Law.”

The decision by Delhi High Court, like all the Indian court decisions preceding it, is built upon a standard of evidence that will crumble under scrutiny.

The presiding judge himself, Sanjeev Sachdeva, admits in the ruling that the grounds for setting aside awards were “limited” – but bowing to the whim of Modi, he proceeded to do so anyway.

Put simply, the ruling is yet another in a long line of desperate actions taken by the Modi regime to evade paying its debts. Moreover, this only puts India in a weaker position in an eventual resolution, especially as Devas readies for its new arbitration claim against the Indian government for its audacious evasion scheme.

Lead counsel to Devas shareholders, Matthew D. McGill, has said the ruling is “one more step in India’s calculated destruction of the Devas shareholders’ investment,” and “a mockery of the international arbitration system…” As a result, Devas’ shareholders intend to pursue all of their legal rights available to them to remedy India’s breaches of Indian and international law, including “yet another arbitration claim that will expose their thuggish behavior before a new international tribunal.”

‘The Big Relief’

Indian media referred to the ruling as a “big relief” for the Antrix Corporation and India.

Where are they finding relief?

Will it be during the new arbitration proceedings where, as McGill notes, “Devas shareholders look forward to holding the Indian government to account for its actions yet again before an impartial international tribunal.”

The impartial tribunal will be the true judge of the legality of India’s behavior and their actions will be measured against the standards of international law.

A Pyrrhic Win? Antrix Claims “Truth Has Prevailed”

Esteemed advocate, Rajat Malhotra, signals in the Times of India that India’s “Big Win” perhaps was just a Pyrrhic Win.

He’s right.

Yet, Chinmoy Roy, a spokesperson and counselor for Antrix doesn’t see it this way, instead boasting, “Truth has prevailed. In all likelihood, the court order will also put to rest the frivolous award enforcement action initiated against Antrix by Devas across the globe.”

Clearly, Mr. Roy has not been paying attention to the news.

Devas’ shareholders have secured victories around the globe, including through the seizure of assets in Canada, France and the United States. As McGill reminded Mr. Roy in the Times of India, “Devas currently has over $50 million under seizure in Canada through Airports Authority of India (AAI) and most recently seized over $87,000 worth of Antrix’s cash assets in the Eastern District of Virginia.” There is no end in sight for India, and the enforcement actions will continue around the world until the awards are fully satisfied.

We would be remiss if we did not remind Mr. Roy and his comrades in Delhi, certain officials – known as the “Magnitsky 11” – are facing serious inquiry into their actions that threaten the security and well-being of Devas co-founder Ramachandran Viswanathan.

Frontiers of Freedom, an American NGO dedicated to protecting the rights and freedoms of individuals and businesspersons across the globe, submitted a petition under the Global Magnitsky Human Rights Accountability Act “to enact serious sanctions against 11 Indian officials for alleged human rights abuses committed against.”

In the petition, submitted to the U.S. Departments of State and Treasury, Modi’s top officials had their abusive actions exposed to the world and their names made known to some of the United States’ highest-ranking authorities. As counsel and spokesperson, Mr. Roy should inform his employer that the truthis going to prevail when India is forced to answer for its lawless behavior and baseless claims during the proceedings before the impartial tribunal seated for Devas’ new arbitration claim.

This week, Law360 reported that Frontiers of Freedom, an American NGO dedicated to protecting the rights and freedoms of individuals and businesspersons across the globe, submitted a petition under the Global Magnitsky Human Rights Accountability Act “to enact serious sanctions against 11 Indian officials for alleged human rights abuses committed against” Devas co-founder Ramachandran Viswanathan.

Read the full petition filed by Frontiers of Freedom here.

The petition was provided to the U.S. Departments of State and Treasury, and requests that the U.S. government implement economic and visa sanctions on 11 of Modi’s top officials for their “attempts to extradite Devas Multimedia’s Ramachandran Viswanathan to India for trial, where he would likely be unlawfully detained and subject to inhumane treatment.”

Matthew D. McGill, lead counsel to Devas shareholders and partner at Gibson Dunn & Crutcher, lauded the filing of the petition:

“The submission of this petition on behalf of Mr. Viswanathan sends a strong message to India: U.S. businesspersons and investors are protected under U.S. and international law, and any attempts to intimidate, harass, or retaliate against them by abusing international organizations and treaties will be met with swift, definitive action. The autocratic perpetrators within the Modi regime will be held accountable for their lawless, thuggish behavior.”

The Modi government, in its desperate campaign to evade paying lawful arbitration awards owed to Devas shareholders, have engaged in an abusive campaign of harassment and transnational repression against Mr. Viswanathan, including unlawful attempts to use the Mutual Legal Assistance Treaty in Criminal Matters between the U.S. and India to “gain intelligence, monitor, question and arrest Mr. Viswanathan” as noted by Frontiers of Freedom.

George Landrith, President of Frontiers of Freedom, in announcing the petition stated, “The actions of the autocratic Indian regime led by Prime Minister Modi are an assault on the rule of law and the rights and freedoms granted to every American. We urge the U.S. government to look past India’s façade and punish, with sanctions, those who seek to violate the rights of Mr. Viswanathan.”

Law360 writes further “Indian officials have also asked Interpol to issue a “red notice” asking worldwide officials to arrest Viswanathan, which means that the satellite company founder cannot leave the U.S. without the fear of being detained…”

All of this behavior is very clearly a violation of Mr. Viswanathan’s rights and freedoms. Frontiers of Freedom reiterates that the Modi government’s actions are simply retaliation and intended to “stop the efforts of Mr. Viswanathan’s company he co-founded, Devas, from enforcing a billion dollar arbitration judgment against the Indian government.”

The 11 Indian Government Officials Named by Frontiers of Freedom

• Nirmala Sitharaman, Finance Minister (May 2019 – Present)
• Rakesh Sasibhushan, Chairman of Antrix Corporation Limited (June 2016 – Present)
• Tushar Mehta, Solicitor General (October 2018 – Present)
• Hemant Gupta, Judge, Supreme Court of India (November 2018 – Present)
• V. Ramasubramanian, Judge, Supreme Court of India (September 2019 – Present)
• Judge Chandra Shekhar, Special Judge (PC Act), New Delhi
• Ashish Pareek, Deputy Superintendent of Police, CBI, New Delhi
• Sanjay Kumar Mishra, Director of Enforcement, Enforcement Directorate
• R. Rajesh, Assistant Director, Enforcement Directorate
• N. Venkatraman, Additional Solicitor General of India
• A. Sadiq Mohamed Naijnar, Deputy Director of the Enforcement Directorate

Magnitsky Act

The Global Magnitsky Act of 2016 along with Executive Order 13818 authorizes the U.S. government to sanction foreign government officials worldwide who have been deemed serious human rights offenders. The sanction would freeze the offenders’ assets and block them from entering the United States. Frontiers of Freedom collaborated with Mr. Viswanathan’s counsel, Gibson, Dunn & Crutcher, as well as Mr. Viswanathan himself to compile and submit the petition.

Yesterday, the Financial Times reported that the Indian government called a secret meeting in February 2020 with representatives of Devas at a lavish Paris hotel to hash out an agreement to settle their long-running dispute over the unlawful cancellation of a contract in 2011.

According to the Financial Times, Ajit Doval, National Security Advisor to Prime Minister Modi and Alur Seelin Kiran Kumar, former chair of the Indian Space Research Organisation (ISRO), represented the Indian government at the closed-door meeting, while co-founder Ramachandran Viswanathan represented Devas along with Larry Babbio, the former president of Verizon and Columbia Capital partner Jim Fleming.

Moreover, the Financial Times reports: “Following the meeting, a deal was drafted which included a provision that all proceedings, including a probe by India’s Central Bureau of Investigation, be dropped. However, the Indian government abruptly stopped responding to Devas’s calls.”

Read the full article from the Financial Times here.

Politically Motivated

The Financial Times reports the Modi government has made the case politicized, “providing Modi’s ruling Bharatiya Janata party with a means of attacking the Congress party, its chief political rival, that struck the contract with Devas when it was in power between 2004 and 2014.”

Finance Minister Nirmala Sitharaman gave a political campaign speech where she called the Devas-Antrix deal a “fraud of the Congress, by the Congress, for the Congress.”

Well-known professor of law at India’s Jindal Global Law School, Prabhash Ranjan, told the Financial Times “One of the endeavours [of the BJP] has always been to completely delegitimise the Congress party and whatever it did before 2014. The narrative is that before 2014 the country was run by a bunch of crooks who looted the country.”

Read the full article from the Financial Times here.

Indian Government Agreed to Drop Criminal Proceedings

Interestingly, the deal drafted “included a provision that all proceedings, including a probe by India’s Central Bureau of Investigation, be dropped.”

Last week, the Hindu BusinessLine reported Modi’s government has become increasing desperate and has sought to declare Devas co-founder, Ramachandran Viswanathan, an “Economic Fugitive” in their phony Prevention of Money Laundering Act case against him.

Reacting to the recent proceedings by the Indian government against Viswanathan, Devas Counsel, Matthew D McGill said, “I believe that government of India’s actions against Viswanathan is a type of thuggish behaviour that we’re used to seeing from Russia, but not from the world’s largest democracy and amount to an intimidation campaign.” 

Read the full article from the Financial Times here.

India’s “Thuggish Behavior” against Devas Escalates with Red Notice Request

Recently, the Daily Caller reported that they had spoken to Ted Bromund, a senior research fellow at the Heritage Foundation and recognized expert on Interpol, who observed that India “commits more abuse than people are aware of.” Bromund warned that “governments can abuse the system to go after political dissidents, including uncooperative businessmen like Viswanathan.”

The Daily Caller also met with Mr. Viswanathan for an exclusive sit down where he spoke out about the Modi government’s campaign of “lawless behavior” in their desperate effort to pressure Devas shareholders to end their global enforcement efforts.

The interview revealed for the first time that the Indian government has sought a Red Notice from Interpol for the arrest of Mr. Viswanathan.

McGill commented that the Indian government’s actions amounted to an “intimidation campaign” and an international warrant for Mr. Viswanathan’s arrest would be “manufactured based on wholly fabricated allegations.”

Interpol is yet to issue a ruling on the request but did reach out to the Indian government in May with more questions about their request against Mr. Viswanathan. Bromund notes the delay is likely because Interpol has “grave concerns” about the request from India.

Read the full article from the Daily Caller here.

Freedom House Exposes Transnational Repression Occurring at the Hands of the Modi Regime

Last month, the Washington Post highlighted a new Freedom House report, Defending Democracy in Exile, which focuses on increasingly aggressive cases of transnational repression by autocratic regimes looking to silence opponents.

The Freedom House report details a stark increase in worldwide cases of transnational repression in 2021, with 85 new cases of “public, direct, physical incidents of transnational repression” reported last year alone. The 42-page indictment warns of an alarming uptick of “brazen” actions by these regimes that seek to exploit international bodies like Interpol to advance their political agenda. The report names a number of countries that “demonstrated a dangerous disregard for international law, democratic norms, and state sovereignty”, including the Indian government.

Modi Government: “Physical Transnational Repression”

According to Freedom House, the Modi government has escalated the use of “physical transnational repression”, targeting the physical health and safety of those who assert their rights and defy the dictates of the Modi regime abroad.

Like other autocratic regimes, the report draws attention to the Modi government’s pursuit of political opponents outside its borders noting that these regimes are “increasingly and more aggressively disregarding US laws to threaten, harass, surveil, stalk, and even plot to physically harm people across the country.”

The author of the report, Yana Gorokhovskaia, explained that these regimes are promoting the idea that “people do not have the right to criticize those in power, no matter where they are in the world — not only at home but once they leave home as well.”

Under the Hindu nationalist rule of Prime Minister Narendra Modi, India has turned to authoritarianism. A 2021 report by Amnesty International showed that journalists, media outlets, and activists were “threatened and intimidated through the misuse of over-broad financial laws.” Political opposition and government critics face similar persecution, with Human Rights Watch noting these opposition voices “are accused of sedition, criminal defamation, or terrorism” and then face arbitrary detention and harassment.

The Berkley Journal of International Law details the Modi regime’s history of these violations, discussing how their attempts to silence outspoken activists, political opposition, and other voices, “by the use of force, arrests, internet shutdowns, and human rights violations” are all part of a broader pattern in Modi’s India that is “neither unprecedented nor surprising.”

Recently, U.S. Secretary of State Antony Blinken spoke of increasing cases of religious repression in India, stating “in India, the world’s largest democracy and home to a great diversity of faiths, we have seen rising attacks on people and places of worship.” His comments come just weeks after the Secretary declared the U.S. was closely monitoring India because of a “rise in human rights abuses by some government, police and prison officials.” Amnesty International has condemned the Modi government’s attacks on political opposition, noting they threaten the “well-being and human rights of millions.”

Bogus Red Notices; U.S. Congress Takes Hard Line

As the Washington Post explains, transnational repression is hard for any one country to fix. Organizations like Interpol are often the first port of call by the authoritarian governments, issuing “Red Notices against dissidents and exiles” as part of their intimidation and harassment campaign, and in the hope that unsuspecting governments will extradite them back to their motherland.

The U.S. Congress has had enough, and is demanding greater action from the U.S. Departments of Justice and State in the face of these tactics by autocratic regimes. U.S. Senators Ben Cardin (D-MD) and Roger Wicker (R-MS) were successful in securing the inclusion of language in the 2022 National Defense Authorization Act that requires the Attorney General and Secretary of State to ensure Interpol is not used as a vehicle by these regimes to “harass or persecute political opponents, human rights defenders, or journalists.”

Millions Seized by Devas Shareholders

Despite the Modi government’s campaign of harassment, their use of physical transnational repression and continued unlawful behavior, Devas shareholders recently announced they have $55 million of monies held by the International Air Transportation Association (IATA) that belong to the Airports Authority of India (AAI) and Air India (AI) under a seizure order.

At the time this was announced, Matthew D. McGill, stated, “Devas will be relentless in its efforts to enforce our lawful international arbitral awards in courts around the world. We will not be intimidated by baseless allegations or the Government of India’s efforts to harass award holders through the use of government-controlled agencies.”

Read the full story of the seizure here.