Air India was facing daily losses of Rs 20 crore; had to sell: Centre to Delhi HC

The Delhi High Court was informed on Tuesday by the Union of India that Air India was in continuous losses and the government could not afford further losses. There were losses of Rs. 20 crore daily approximately and it could not allow wastage of more public money, the Union of India lawyer said.

The submission of Solicitor General of India Tushar Mehta came on Tuesday during the hearing of a plea moved by Rajyasabha MP Subramanian Swamy that sought to quash/set aside the Air India disinvestment process.

SG Mehta argued that the successful bidder Talace Private Limited was fully owned by Tata Sons and unrelated to Air Asia. He also said disinvestment is a policy decision and the decision was taken in 2017 due to the heavy continuous losses.

The bench of Justice DN Patel and Justice Jyoti Singh on Tuesday reserved its order on the petition and asked the parties to file their written notes in this regard. The bench has set January 6, 2022, for the passing of the order in the matter.

Appearing in person, Subramanian Swamy argued that the process of bidding was malafide, arbitrary and against the public interest. Terming the disinvestment a "gigantic corruption", the petitioner also sought a full-fledged investigation into the role of the government and the process which he claimed was lacking in accountability.

There is a clear statement that the insolvency process is ongoing in Madras High Court which passed orders against Spicejet and therefore it was not entitled to bid. As a result, this means that there was only one bidder and the bid cannot take place, said Subramanian Swamy.

Senior Advocate Harish Salve appeared for the Tata Group. While opposing the Swamy plea he submitted that the successful bidder is a 100 per cent Indian company owned 100 per cent by an Indian. The share purchase agreement has been signed and everything is in the public domain.

"All efforts" to hand over all operations of Air India to Tata Sons by the end of December, Secretary Ministry of Civil Aviation Rajiv Bansal had said recently.

Tata Sons had won the bid for acquiring national carrier Air India for Rs 18,000 crore, on October 8, 2021, ending Centre's attempts to privatise the debt-laden airline. Tata Sons, which originally launched Air India with a namesake branding (Tata Air Services) in 1932, bid for the carrier under its wholly-owned subsidiary Talace Pvt Ltd for Rs Rs 18,000 crore.

The government earlier informed that the winning bidder--Tata Sons--will retain all employees for one year and the group will need to offer a voluntary retirement scheme if it decides on retrenchment after the period.

The government has said that the interest of the employees and retired employees would be taken care of in the disinvestment process. The government will divest its 100 per cent stake in Air India, Air India Express and 50 per cent stake in ground handling company AISATS.

( With inputs from ANI )

Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor