Delhi High Court Reserves Order On BJP MP Subramanian Swamy's Challenge Against Air India Disinvestment Process

The Delhi High Court today reserved order on the PIL filed by Rajya Sabha MP Subramanian Swamy, seeking to quash the Air India disinvestment process.

The division bench comprising of Chief Justice DN Patel and Justice Jyoti Singh directed both Swamy and Solicitor General Tushar Mehta appearing for the Union Government, to file written notes by tomorrow. The order will be pronounced on Thursday, January 6.

Tata group had emerged as the winning bidder for Air India, the government in October last year signed the share purchase agreement with Tata Sons for the sale of the airline for Rs. 18,000 crore.

Swamy has alleged that the bid process was arbitrary, corrupt, against public interest and rigged in favour of Tata group.

He also alleged that the second bidder was a consortium led by the owner of SpiceJet. However, insolvency proceedings are going on against the company in Madras High Court, it was not entitled to bid and thus effectively there was only one bidder.

Swamy also submitted that CBI and ED are investigating Tata's joint venture with Air Asia (a foreign airline) which he says is a premeditated conspiracy to illegally grab control of air space of domestic airlines by foreign airlines violating norms of FDI and Cabinet Notes and other laws.

Solicitor General Tushar Mehta, appearing for the Central government, claimed that the disinvestment was a policy decision which was taken keeping in view huge losses to Air India. "We cannot afford single day further accumulation of loss," he said.

Mehta submitted that the decision was taken in 2017 that whenever the disinvestment takes place, up to that date the government will bear the losses and after that the date, the bidder will bear the losses. "So this is not a decision taken today to help a particular party," he submitted.

He also pointed out that SpiceJet was never a part of the consortium and thus, the proceedings against it are irrelevant to the disinvestment process.

On the allegations pertaining to conspiracy with Air Asia Group, Mehta submitted that Talace Private Limited, which acquired Air India, is wholly owned by Tata Sons and has no relation with Air Asia. Thus, those proceedings are also irrelevant to the case, he claimed.

Senior Advocate Harish Salve appearing for Tata group submitted that the process should not be kept pending. "Airlines business is tough. These are very large transactions. Already the client is getting nervous, whether they'll be paid or not. Govt has given assurances. It has been struggling to sell off since 2017," he said.

Salve further pointed out that Swamy has not brought on record any material to substantiate the allegations of corruption.

After hearing both the sides at length, the bench reserved its order.

Case Title: Dr. Subramanian Swamy v. Union of India & Ors.