Tata Sons on Friday said it has transferred $1.17 billion into fixed deposits favouring the Court Registrar, New Delhi “without prejudice to its legal rights” in the wake of the recent London Court of International Arbitration’s arbitral award involving Japan’s largest mobile phone firm NTT DoCoMo.
Tata Sons was ordered to pay DoCoMo $1.17 billion last month in compensation for breaching an agreement on India joint venture.
The High Court has given time till August 30, 2016, for both parties to try and resolve the outstanding issues between them. “Tata Sons wishes to clarify that it has in the past, as well as after the arbitral tribunal announced its award, invited Docomo to join it in representing this matter before the Reserve Bank of India and the Ministry of Finance,” Tata Sons said.
“We would caution against any stakeholders being misled by statements that are made in ignorance of India’s foreign exchange regulations,” it said.
Earlier in the day, accusing the Tata group of not willing to pay $ .17 billion compensation, DoCoMo said the RBI disallowing its “mischaracterised” application does not bar the Indian group from paying out of funds or assets outside the country.
DoCoMo in a statement said Tata Sons was citing the 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.
On Thursday, 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.
Keen to get the $ 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 on Thursday said it has 23 days from July 27 to apply for the order to be set aside. The Japanese firm also filed a plea in the Delhi High Court seeking enforcement of the arbitration ruling.
DoCoMo said it notes Thursday’s statement by the Tatas committing to honour its contractual obligations and settle the arbitration award. “DoCoMo also wishes that outcome,” it said.