Antrix cloud over Devas again; Enforcement Directorate attaches Rs 79 crore assets

Bengaluru: The Enforcement Directorate (ED) on Tuesday attached over Rs 79 crore of Devas Multimedia Pvt Ltd, Bengaluru under the Prevention of Money Laundering Act, 2002 in the controversial Isro/Antrix deal after the ED searched the premises of Devas last month and recorded the statements of Director (finance) Ranganathan Mohan, founder-director Desaraju Venugopal and former director D. Nataraj Ramachandran Viswanathan in which they confessed to the crime.

Two other directors, who are also involved in the criminal conspiracy – Ramachandran Viswanathan and M. Chandrashekhar are in the US, said an official source.

“The ED has provisionally attached the proceeds of the crime amounting to Rs 79,76,00,041 under the PMLA from Devas Multimedia in the form of upfront capacity reservation fee available with the Indian Space Research Organisation, mutual fund deposits and bank deposits,” he said.

The controversial agreement, signed in 2005 between Antrix and Devas and cancelled in 2011 because of various discrepancies, including financial mismanagement, conflict of interest and nepotism, had gained international notoriety. In August 2016, the CBI had chargesheeted the then ISRO chairman G. Madhavan Nair in the case, which had allegedly bled the state exchequer of Rs 578 crore. Mr Nair was heading Isro and Antrix Corporation, when Antrix signed a contract with Devas Multimedia for lease of almost the entire transponder space on two satellites that Isro had planned to launch. Devas was also supposed to get 70 MHz of the 150 MHz spectrum in S-band that Isro possessed.

According to the ED, the agreement entered by Devas with the Isro/ACL was illegal as Devas did not have any technology/ownership of intellectual property rights to deliver the multimedia services and the main purpose of the agreement was to raise foreign investments on the strength of the agreement with Isro and thereafter to siphon off the investment raised, out of India in the guise of investment in subsidiary company, business support services and legal fee.   

“The subject company (Devas) never did any major business in India other than providing internet services to about 20-25 customers in Bengaluru. However, nearly 85 per cent of the foreign investment raised was siphoned off out of India in the guise/pretext of investment / services/ fee.  Further, the staff strength of Devas is only three and the staff strength of its subsidiary is also only three,” read the official statement. Devas was incorporated on December 17, 2004 and had falsely claimed that it had the ownership and intellectual property rights to use the technology for delivering multimedia services and had entered into an agreement with Isro/ACL for providing multimedia services in India. “Some employees of Isro/ACl had also conspired with Devas for signing the agreement.  On the strength of the said agreement Devas raised foreign investment of Rs 579,07,42,505. They had also incorporated their subsidiary company in America in the name of Devas Multimedia America Inc. and out of the raised foreign investment an amount of Rs 76,19,04,5643 was transferred to it as investment. Further, an amount of Rs 180,77,58,989 was also transferred to its subsidiary in America in the pretext of providing business support services. An additional amount of Rs 230,11,14,734 was spent as legal fee and out of the said amount a major portion was transferred to the USA in the guise of legal fee, stated an official release by the ED," the statement said.