The Directorate of Enforcement (ED) served a summons to the founding CEO of a space start-up in Bengaluru and the company’s US subsidiary through diplomatic channels to facilitate the opening of a trial in a case money laundering for more than three years after filing a complaint against them.
The money laundering case arose out of a failed 2005 satellite deal between Devas Multimedia and ISRO’s Antrix Corporation.
The ED informed a special court in Bengaluru of the meaning of a subpoena on Ramachandran Vishwanathan, founding CEO of Devas Multimedia, and Devas Multimedia America Inc (DMAI), the US subsidiary.
In September this year, the special court dismissed an ED plea to split the trial into two – one against eight defendants who received a subpoena and another against those who were not available – Vishwanathan and Devas Multimedia America Inc. in this matter.
ED’s indictment was filed in July 2018. Other defendants include several Devas officials, three subsidiaries of the company, and a former executive director of Antrix Corporation – a commercial arm of the Indian Organization of India. space research, managed by the State.
The indictment, filed under the Prevention of Money Laundering Act, alleged that Devas Multimedia transferred to the United States 85 percent of the Rs 579 crore in foreign funding it received in the United States. under a 2005 agreement with ISRO in the United States in connection with various claims.
As part of the agreement, ISRO was contracted to lease two communications 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 space-band or S-band spectrum repeaters on ISRO’s GSAT 6 and 6A satellites.
The Devas Multimedia-Antrix Corporation (ISRO) deal was canceled by the UPA government led by Manmohan Singh in February 2011 over allegations that the contract was a “friendly deal” in the context of the 2G scam in the telecommunications sector.
When the NDA government came to power in 2014, the CBI and ED were asked to investigate the deal. The CBI filed its indictment in 2016 against Devas, Antrix and former ISRO officials for the failure of the deal.
In a statement while attaching a value of 79.76 crore rupees to the assets of Devas Multimedia in India in 2017, the managing director said: out of the investment raised, out of India under the guise of an investment in a subsidiary, business support services and legal fees. “
After the cancellation of the 2005 agreement, foreign investors in Devas Multimedia – the German telecommunications company Deutsche Telekom, three foreign investors based in Mauritius and Devas Multimedia approached various international courts to seek damages for the failure. of the agreement.
In addition, the National Company Law Tribunal in India ordered the liquidation of Devas Multimedia on May 25 following a plea by Antrix Corporation that fraud had been perpetrated in the creation of the start-up.