“Accused No.2 Sri.Ramachandran Vishwanathan is declared as a Fugitive Economic Offender,” the special court said in its order on June 8. The court also told the Union government to confiscate bank accounts and mutual funds valued at Rs 79.76 crore, declared as proceeds of money laundering.
The tagging of Viswanathan as a fugitive economic offender is the third such order in the country after orders against Vijay Mallya and Nirav Modi, Special Public Prosecutor P Prasanna Kumar said.
The ED had moved the special court in
Bengaluru in 2022 to declare the CEO a fugitive economic offender.
The accused despite “knowing fully about these two cases and current proceedings are intentionally avoiding appearance before the court” the ED said in March this year.
The court was informed about a December 12, 2022 communication received from the Ministry of External Affairs and communication received from the United States for the service of the court notice to the Devas CEO in the US.
The Devas founder is among nine individuals and entities accused of money laundering by the ED in a charge sheet filed in July 2018.
Viswanathan and the others are accused by the ED of allegedly diverting to the US 85 per cent of a total of Rs 579 crore of FDI which Devas received following the 2005 satellite deal.
The satellite deal was annulled in 2011 by the UPA government by citing requirement of space spectrum allocated under the satellite deal for the defence sector.
The Devas CEO is a satellite communications entrepreneur in the US and is now the president of Omnispace LLC, a satellite communications start-up in the US, which is putting together a constellation of satellites to power 5G from space – especially to provide connectivity to remote areas where terrestrial mobile networks do not work.
The others accused in the case under the Prevention of Money Laundering Act (PMLA) are Devas Multimedia director M G Chandrashekar, Devas CTOs Desaraju Venugopal and Nataraj Dakshinamurthy, a finance director Ranganathan Mohan, and three Devas subsidiaries.
The Karnataka high court in September 2022 acquitted the former executive director of
ISRO’s Antrix Corp K R Sridharamurthy from the ED money laundering case by indicating that the satellite deal with Devas Multimedia was decision of the board of the Antrix Corp.
While others who are accused of money laundering have responded to summons issued by the special court for the start of the trial in the ED’s money laundering case, Viswanathan, the founder-CEO of Devas Multimedia, did not respond.
The case against Devas Multimedia officials and others has roots in a 2005 deal between the start-up and ISRO’s Antrix Corp. to use two ISRO communication satellites to provide multimedia services to mobile devices in remote areas where conventional, terrestrial telecom networks do not have reach.
Under the 2005 satellite deal with Devas, the Indian space agency ISRO was contracted to lease two communication satellites for 12 years at a cost of Rs 167 crore to Devas Multimedia.
The start-up was to provide video-audio services to mobile platforms in India using the space band or S-band spectrum transponders on ISRO’s GSAT 6 and 6A satellites built at a cost of Rs 766 crore by the space agency.
The Devas Multimedia-Antrix Corp agreement was annulled by the UPA government in February 2011 following allegations of the contract being a “sweetheart deal” in the backdrop of the 2G scam. After the NDA government came to power in 2014 the Central Bureau of Investigation (CBI) and ED began full-fledged investigations of the 2005 satellite deal.
The ED and the CBI have filed charge sheets alleging corruption and money laundering in the matter.
The CBI filed a charge sheet in 2016 against Devas and Antrix and their executives including former ISRO chairman G Madhavan Nair on charges of corruption.
Following the cancellation of the 2005 deal, Devas Multimedia and its foreign investors approached international arbitration tribunals to seek compensation for losses they incurred. Devas and its foreign investors have been awarded compensation by three arbitration tribunals over the failed deal.
The biggest compensation award has been a September 14, 2015, ICC tribunal award of over $ 1.2 billion which was confirmed by a US federal court on October 27, 2020. Antrix Corporation has filed an appeal against this order in the US Court of Appeals for the Ninth Circuit.
Based on the CBI and ED cases against Devas Multimedia, the National Company Law Tribunal in India ordered the liquidation of Devas in May 2021 on charges that the company was created in a fraudulent manner. This order was upheld by the Supreme Court of India in January this year.
Devas Multimedia and its investors — including the German telecom major Deutsche Telekom — are involved in a protracted legal battle across the world over the decision of the Government of India in 2011 to annul the 2005 satellite deal between Devas and ISRO’s Antrix
