Synopsis: Senior Advocate Harish Salve, said that Vodafone will not continue with the second arbitration unless the award is set aside under the India-Netherlands BIPA.
In the proceedings initiated by Vodafone under the India-Netherlands Bilateral Investment Protection Agreement (BIPA), the Central Government requested more time from the Delhi High Court to explain whether or not the Government of India will appeal the arbitral award against it.
The Additional Solicitor General, Chetan Sharma, representing the Central Government claimed that the decision would take some more time as it must pass through the Cabinet’s Empowered Committee.
A Division Bench of Justices Rajiv Sahai Endlaw and Asha Menon heard the appeal of the Centre against the decision of the Single Judge to refuse to prohibit Vodafone from initiating second arbitration proceedings under the India-UK BIPA while the proceedings under the India-Netherlands BIPA were still pending.
Following its acquisition of a stake in Hutch (Hutchinson Essar Limited), the arbitration proceedings were focused towards the retrospective application of tax liability on Vodafone.
It was the grievance of the Centre before the High Court that the initiation of second arbitration proceedings under the BIPA between India and the United Kingdom led to abuse of procedure.
The Permanent Court of Arbitration in The Hague recently ruled in the first arbitration proceedings in favour of Vodafone and held that Telco was entitled to equal and equitable treatment under the BIPA between India and the Netherlands.
Senior Advocate Harish Salve claimed that the continuation of the present injunction proceedings had no cause left.
Salve added that, unless an award under the India-Netherlands BIPA is set aside by the competent authority, Vodafone will not continue with the second arbitration under the India-United Kingdom BIPA.
He said that it may be contested in Singapore, however, the court of Singapore would not condone delay, because the Indian Cabinet needs time.
In view of the circumstances the court asked whether if possible, the appeal could be disposed off and resurrected at an appropriate time.
The court adjourned the hearing until 8th December, granting the Central Government counsel time to obtain guidance on the same.