A petition was filed before the Delhi High Court by Parliamentarian Subramanian Swamy seeking quashing of the disinvestment process of Air India. Mr. Swamy, who had sought a direction from the government to quash this Air India disinvestment process, terming it “arbitrary, unconstitutional, unfair” and “rigged in favour of the Tatas.” The petition pleaded that the only bidder within the disinvestment process was a consortium led by the Spice Jet owner, which was facing insolvency proceedings within the Madras court and thus couldn’t have bid.
On October 8, 2021, the Cabinet Committee on Economic Affairs approved the highest price bid of Talace Private Limited for sale of 100% equity shareholding of the Government of India in Air India, along with the equity shareholding of Air India in Air India Express Limited and Air India Air Transport Services Limited.
On December 20, this deal was also approved by the CCI i.e. Competition Commission of India.
On October 25, the government had entered into a purchase agreement with Tata Sons for the sale of Air India for Rs 18,000 crore. Tata will give Rs 2,700 crore in cash to the government in lieu of the deal and will take on the debt of Rs 15,300 crore outstanding on the airline.
The two judges’ bench of Delhi court noted that the selection to disinvest the national carrier was a “policy decision” and was taken after “due diligence”. The court observed while dismissing the petition that the writ petition is wholly void of merit.
Disinvestment was policy decision: The two judges’ bench in its order noted that the choice to disinvest the national carrier was a “policy decision” and was taken after “due diligence” by the govt.
“This was a policy decision by the Central Government, taken after due deliberations, at various levels. and is not open to interference in judicial review by this Court…more particularly in the absence of any illegality or arbitrariness being established by the Petitioner, in the decision-making process,” the order read.
Highly belated challenge: The court while accepting the submissions made by the Respondents that the petition could be a highly-belated challenge. The court also noted that the Air India disinvestment process has reached its conclusion.
“The bidding process is complete, in which Talace has emerged as the highest bidder. M/s Talace Private Limited is a wholly-owned subsidiary of M/s Tata Sons Private Limited. Cabinet Committee of Economic Affairs has approved the highest price bid of Respondent No.6 on 08.10.2021, for sale of 100% equity shareholding of Government of India in Air India, along with equity shareholding of Air India, Air India Express Limited (AIXL), and Air India Transport Services Limited (AISATS),” the order stated.
Plea of investigations against Air Asia could not take off: The court also junked the submissions of Swamy that M/s Talace shall be disqualified from the bidding process as there are investigations against AirAsia Ltd., where one among the shareholders is AirAsia Investment Ltd., Malaysia, and that they have direct and indirect control over Talace and there’s a breach of Foreign Direct Investment Policy.
HON’BLE MR. JUSTICE D.N PATEL
Chief Justice, Delhi High Court
HON’BLE MS JUSTICE JYOTI SINGH
Judge, Delhi High Court
