The Central government yesterday sought more time from the Delhi High Court to clarify whether or not the Government of India would challenge the Vodafone arbitration award against it in the proceedings initiated under the India-Netherlands Bilateral Investment Protection Agreement (BIPA). (UOI vs Vodafone Group Plc)
Additional Solicitor General, Chetan Sharma, representing the Central government, stated that the “decision will take some more time” as the same has to go through the Empowered Committee of the Cabinet.
A Division Bench of Justices Rajiv Sahai Endlaw and Asha Menon was hearing Centre’s appeal against the single-judge’s refusal to restrain Vodafone from initiating second arbitration proceedings under the India-UK BIPA when the proceedings under the India-Netherlands BIPA were still pending.
The vodafone arbitration award proceedings were directed against the retrospective imposition of tax liability on Vodafone following its acquisition of a stake in Hutch (Hutchinson Essar Limited).
It was the Centre’s grievance before the High Court that initiation of second vodafone arbitration award proceedings under the India-United Kingdom BIPA amounted to abuse of process.
Recently, in the first arbitration proceedings, the Permanent Court of Arbitration at The Hague ruled in favour of Vodafone and held that the telco was entitled to fair and equitable treatment under the India-Netherlands BIPA.
Senior Advocate Harish Salve today said that there was no cause left for the continuation of the present injunction proceedings.
Salve added that Vodafone would not proceed with the second arbitration under the India-United Kingdom BIPA unless the award under the India-Netherlands BIPA is set aside by competent authority.
“It (the Vodafone arbitration award) can be challenged in Singapore. Singapore courts will not condone delay because Indian Cabinet is taking time,” he remarked.
In view of the circumstances, the court asked whether the appeal could be disposed of and be revived at an appropriate time, if required.
Affording time to the Central government counsel to seek instructions on the same, the court adjourned hearing till December 8.