Tata taken to US court by NTT Docomo for recovery of $1.17 billion [Read Tata’ statement]

After approaching the Delhi High Court against its former partner, Japanese telco NTT Docomo has now taken Tata Teleservices Limited (TTL) to the Southern District Court in New York, for the recovery of $1.17 billion, reports VCCircle..The dispute dates back to 2009, when Docomo bought a 26.5% stake in TTL, giving birth to the GSM service Tata Docomo. At that point of time, the parties agreed that Docomo could sell its shares if TTL failed to achieve its performance target for 2014. NTT exercised the option in July that year to sell the stake to either a third party or to Tata Sons. However, since TTL could not find a buyer, Docomo decided to file arbitral proceedings against the Indian company..To this end, they had approached the London Court of International Arbitration (LCIA), which passed an award in Docomo’s favour. The Japanese company subsequently went to the Delhi High Court to get the award implemented. On July 26 of this year, Justice Manmohan Singh directed Tata to deposit the award amount of 8,450 crore..The matter was last heard earlier this week, and adjourned for December 1..In the High Court, Docomo was represented by Senior Advocates Kapil Sibal, Rajiv Nayar and Ciccu Mukhopadhaya, along with lawyers from Khaitan & Co., led by Partner Sanjeev Kapoor..Appearing for TTL were Senior Advocates Sandeep Sethi, Darius Khambata and Mustafa Doctor, along with a host of partners from AZB & Partners – including Rajendra Barot, Ratnadeep Roychowdhury and VP Singh – as well as Ashim Sood from Ashim Sood Law Offices..And now, Docomo has decided to get the award enforced in the US. They were represented by Kobre & Kim LLP’s Partner Steven Gary Kobre..Business Standard quoted a Docomo statement which says that the LCIA award was enforceable in any country which is a signatory to the New York Convention. The Convention allows private parties to seek court intervention to enforce the awards passed in cross-border arbitrations. If one party fails to pay the dues, the petitioner can approach any other jurisdiction where the respondent has assets to recover the dues..Since India and US are both signatories to the Convention, Docomo has pursued litigation in both countries..Update: Tata Sons Limited recently filed evidence in the English High Court of Justice to set aside the ex-parte order granting Docomo leave to enforce the LCIA arbitral award. Here is a statement from a Tata spokesperson:.“Tata Sons Limited has today filed evidence in support of its September 5th, 2016 application before the English High Court of Justice. The application seeks to set aside the Court’s July 25th, 2016 ex-parte order that granted NTT Docomo Inc. leave to enforce the LCIA arbitral award dated June 22nd, 2016..Tata Sons’ evidence outlines the grounds on which enforcement of the award will be resisted by Tata Sons. These include: first, that Docomo has not validly tendered its shares in Tata Teleservices Limited to Tata Sons, which is a necessary condition precedent to payment by Tata of the sum awarded by the arbitral tribunal; and secondly, that performance of the award without approval by the Reserve Bank of India would be illegal under Indian law and/or contrary to public policy..Tata Sons wishes to clarify that, by pursuing the above application before the English High Court, it is following the path laid down by the arbitral tribunal in the award. The arbitral tribunal, with Docomo’s encouragement, expressly left open the issue of whether performance of the award would require approval from the Reserve Bank of India. Tata sought such approval and was refused. Accordingly, Tata Sons’ actions do not, in any manner, detract from its stated commitment to discharge its obligations to the fullest extent permitted under law. As evidence of the same Tata Sons has deposited, and continued to keep deposited, a sum of $1.17 billion, representing the entire amount due under the award, with the Delhi High Court since July 2016.”