» Business » High & mighty of India Inc faced the music in 2014

High & mighty of India Inc faced the music in 2014

By Pritam Pal Singh & Hary M Pillai
Last updated on: January 02, 2015 17:08 IST
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The year gone by saw the high and mighty of the corporate world face the music in the Delhi High Court which held that the telecom majors are amenable to CAG audit and Mukesh Ambani's RIL struggling hard to get rid of an FIR lodged on gas pricing by the 49-day-old AAP regime.

Image: Reliance Industries chairman Mukesh Ambani. Photograph: Danish Siddiqui/Reuters

Wresting power on the promise of cheap electricity and water, the Arvind Kejriwal government cracked the whip by lodging the FIR on a complaint against Reliance Industries Ltd (RIL) and then ministers in UPA II at the Centre accusing them of colluding to raise price of the gas supplied from its KG-6 well.

Stung by AAP's action few days before it relinquished power, RIL moved the high court for quashing the FIR and got support from the then UPA regime and the new NDA government toed the same line by questioning the power of the state machinery in lodging the FIR. The issue remains subjudice.

However, in a blow to the telecom sector, the high court dismissed their contentions by holding that the Comptroller and Auditor General (CAG) can audit them, forcing them to move the Supreme Court where also they returned empty hand.

Image: AAP leader Arvind Kejriwal. Photograph: Reuters

Power distribution companies also struggled to keep away from them the sword of CAG audit, which was ordered by Arvind Kejriwal-led government in city and the high court refusing to stay it.

RIL was also dragged to the high court by state-owned PSU ONGC accusing it of exploiting gas worth Rs 30,000 crore (Rs 300 billion) from the PSU's natural gas block in the KG6 basin.

The matter took a new twist when an activist and a lawyer jointly moved an intervention application calling for a thorough court-monitored probe and claiming the Centre has allegedly pressured the PSU to withdraw its petition which is pending.

Automobile majors like BMW, Mercedes Benz India Pvt Ltd, Mahindra & Mahindra and Tata Motors besides 10 others had rushed to the high court against an order of Competition Commission of India (CCI) imposing a total penalty of Rs 2,554 crore (Rs 25.54 billion) for allegedly violating trade norms in spare parts and after-services market and asked them to deposit the amount within 60 days.

However, the high court which has not stayed the CCI's August 25, 2014 decision, protected the car makers from paying the amount till it decides their pleas before it.

Besides car makers, several airlines, including one of India's oldest business enterprises Tata Sons, were also dragged to the high court over grant of licence for operations in India or non payments of dues to pilots.

Image: AirAsia faced hurdles too. Photograph: Reuters

BJP leader Subramanian Swamy and the Federation of Indian Airlines have opposed the clearances granted to the Tata-SIA and Tata-AirAsia deals and the high court is currently hearing arguments of all the stakeholders.

The now defunct Kingfisher Airlines was dragged by several of its pilots over non-payment of salary, with the high court directing the grounded carrier to pay the dues.

Kingfisher Airlines itself was forced to move the high court after its guarantors, Vijay Mallya and United Breweries (Holdings) Ltd (UBHL), and the carrier were not allowed to bring lawyers to a proceedings held by Punjab National Bank (PNB) to declare them as wilful defaulters.

Image: A passenger walks with her luggage in front of a Kingfisher Airlines reservation office at the domestic airport in Mumbai. Photograph: Danish Siddiqui/Reuters

The airline initially got relief from a single judge of the high court, but PNB went in appeal before a division bench which has reserved its verdict on the issue.

Telecom major Vodafone also accused the government before the high court of indulging in "arm-twisting" and "coercive" tactics by refusing to sign its unified licence (UL) till the company unconditionally accepts the "restrictive" clauses in the licence.

Vodafone withdrew its plea after the high court observed that according to Telecom Regulatory Authority of India (TRAI) Act there was an alternative remedy available before the Telecom Disputes Settlement and Appellate Tribunal (TDSAT).

Chinese mobile phone companies Xiaomi and Shenzhen had worrying moments towards the end of 2014, after the high court issued interim orders restraining them from selling their handsets here on the plea of Swedish telecommunications giant Ericsson and Indian mobile handset manufacturer Micromax, respectively.

Xiaomi was restrained for allegedly infringing the patents of Ericsson, while Shenzhen was banned from selling its OnePlus handsets over a three-way contract infringement dispute with Micromax and US-based software firm, Cyanogen which makes customised versions of Android operating system.

Both the Chinese companies, however, breathed a sigh of relief when a larger bench of the high court lifted the ban later on sale of their handsets with some conditions attached and sent the matters back to the single judges for being heard fully.

Image: Chairman of Aditya Birla Group, Kumar Mangalam Birla. Photograph: Reuters

In the last quarter of the year gone by, Chairman of Aditya Birla Group, Kumar Mangalam Birla got relief from the court which dismissed the Centre's contempt plea against him for group company Idea Cellular's alleged violation of a court order not to add new customers for providing 3G telecom services.

Half-way through the year, an organisation of drug manufacturers challenged the National Pharma Pricing Authority (NPPA's) July 10 notification that brought over anti-diabetic and cardiovascular drugs under price control.

Thereafter, NPPA withdrew the guidelines under which the notification was issued, but the high court questioned it whether the cap on prices would survive, asking it to make its stand clear by way of an affidavit.

The high court also heard arguments, staggered throughout the year, on the pleas of pharma companies J K Ansell and Reckitt Benckiser on the government's cap on condom prices.

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Pritam Pal Singh & Hary M Pillai in New Delhi
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