Transponder scam: PMO sat on Isro file since July 2010?

NEW DELHI: The Space Commission, headed by Isro chairman and department of space secretary K Radhakrishnan, is meeting on Friday to discuss the cancellation of Devas Multimedia's contract. Under pressure to revoke the deal which has embarrassed the government, particularly the PMO, no end, the space agency is likely to recommend its cancellation.

Sources said a recommendation to annul the deal will be accepted by the Union Cabinet next week. Sources said a cornered prime minister has asked officials to put the issue on the agenda of the Cabinet as early as next week to deflect rising criticism on a matter concerning a department directly under his control and having huge financial implications.

The fact that a recommendation of the Space Commission for annulment of Devas's contract is pending before the PMO since July 2010 became more embarrassing for the prime minister when on Tuesday, Radhakrishnan clarified at a press conference that it was for the department of space to apprise the Cabinet and take a final call on the annulment of the contract.

Isro arm Antrix entered into a joint venture with private company Devas Multimedia in 2005, and as per the agreement, took the liability to fund and launch two satellites for the JV and allocate scarce 70 MHz S-band spectrum to the company free for its usage to roll out innovative technologies.

The issue of free allocation of rare S-band spectrum to Devas and keeping the Cabinet in the dark has been raised by the opposition parties which are now attributing motive behind keeping such an important issue in cold storage for so long.

After an internal inquiry ordered by Space Commission chief Radhakrishnan in December 2009, it was found that Antrix's joint venture was allegedly one-sided in favour of the private company.

The Cabinet was kept in the dark despite the government's official auditor and the Space Commission raising some vital queries on the issue of launch of two satellites for the JV. The Comptroller and Auditor General (CAG), in its preliminary audit, sought to know why no competitive bidding was called before the contract was awarded to Devas. So far, the department of space has chosen to ignore all queries.

Radhakrishnan on Tuesday hinted that some senior officials in Isro and the department of space may face punitive action for hushing up the matter.

He said before the DoS recommended cancellation of the contract, it had consulted the Union law ministry. When asked if not informing the Cabinet tantamounts to misleading, the DoS secretary said it could have been for two reasons: though 90% of the usage of the satellite was for the joint venture, 10% was exclusively for Isro.