Wednesday, January 11, 2017

Aircel - Maxis (Deal) Fiasco: The Apex Court and Some Thoughts..
In the Aircel-Maxis deal case lodged by CBI and the Enforcement Directorate (ED) it was alleged that South Asia FM Ltd (SAFL) and Sun Direct TV Pvt Ltd (SDTPL) had received Rs.742.58 crore as "proceeds of crime" from Mauritius-based firms.

Later ED alleged before the court that Dayanidhi had generated funds worth Rs.742.58 crore through illegal means and there was sufficient prima facie material to proceed against him and other accused in the case. And thus the narrative changed..

Now, DNA India, a BJP sympathetic web portal writes: 

The Supreme Court order preventing Aircel from disposing of its spectrum and licences through a proposed merger with Reliance Communications is a befitting response to the its promoters disregarding Indian laws. Aircel is owned by Malaysian company Maxis, whose Indian origin promoter Ananda Krishnan has been chargesheeted by the Central Bureau of Investigation, in one of the 2G spectrum scam cases. Though the court is slated to frame charges, it will not be able to proceed with the trial against Krishnan unless he appears in person to defend himself.

The Supreme Court stayed the sale and trading of the licences and spectrum noting that spectrum was a “very valuable resource” on which a lot of money could be made. The court noted that if that money was earned on account of fraud and Krishnan was not facing the legal process, “then we cannot allow that money to be earned by anyone”. The loudest criticism against the Supreme Court during the UPA-II years were that courts were hurting investment through judicial activism.

If judges have to look beyond the constitutionality and legality of cases and also factor in the fallout of their decisions, it is impossible for justice to be delivered. The Supreme Court judgment ruling that scarce natural resources must be auctioned raised a hue and cry from telecom operators and the power sector complaining that business would turn unprofitable and costs would increase for consumers". 

Now the point is when the deal involves only Rs.742.58 crore, what is logic of blocking a Rs.65, 000 crore deal, especially on the ground of possible personal and political vendetta..? Judicial and too much political activism, accompanied by over regulations has hereto destroyed the once vibrant telecom sector.

Now if the Judges, start to frame policies by their whims and caprices, then it is a very bad news for India. Any justice should have a human touch instead of hard and rock solid bookish judgements. In this context let me quote from Law Live:

The necessity of a judiciary which is in tune with the social philosophy of the Constitution has nowhere been better emphasised than in the words of Justice Krishna Iyer which we quote: “

Appointment of Judges is a serious process where judicial expertise, legal learning, life’s experience and high integrity are components, but above all are two indispensables — social philosophy in active unison with the socialistic articles of the Constitution, and second, but equally important, built-in resistance to pushes and pressures by class interests, private prejudices, government threats and blandishments, party loyalties and contrary economic and political ideologies projecting into pronouncements. (Mainstream, November 22, 1980)” Justice Krishna Iyer goes on to say in his inimitable style: “Justice Cardozo approvingly quoted President Theodore Roosevelt’s stress on the social philosophy of the Judges, which shakes and shapes the course of a nation and, therefore, the choice of Judges for the higher Courts which makes and declares the law of the land, must be in tune with...tune with the social philosophy of the Constitution. Not mastery of the law alone, but social vision and creative craftsmanship are important inputs in successful justicing. (Mainstream, November 22, 1980)”...

Therefore, we can conclude that any judgement which does not take into account a broader social perspective, is artificial and is not likely to help in true nation building.

In Aircel - Maxis case too the apex court should act in such a way that it creates minimum pain for the innocent minority shareholders, while identifying the true miscreants and punishing them, according to the laws of the land. The question is why should the shareholders suffer and their wealth damaged because one of the promoter's of that merged entity is failing to appear in the court....😰😰😰😰. The court instead of penalizing the retail Investors should have gone all out for bringing Ananda Krishnan to India, isn't it

This is like an old Bengali Joke: "Because I could not get hold of you, I will take action against your shit wherever I get them...!! Sardonic, are some of the Apex Court directions/actions and judgements. Really what to say!!

However, it seems on the short term there is relief on the anvil for the shareholders, as a news on the ET of 11 January, 2017, almost echoes my view:

"The telecom company may seek an opportunity to present its side of the issue and is likely to stress that any decision on its spectrum holding would have implications for stakeholders such as lenders, vendors and employees, apart from shareholders besides Maxis. Senior lawyer Harish Salve said he has been consulted on the matter, but did not comment further".

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