SC allows Motorola's prosecution in alleged cheating case

The Supreme Court today paved way for prosecution of Motorola Incorporation and its five directors in a case of alleged cheating against Iridium India Telecom.

A bench comprising Justice B Sudershan Reddy and Justice S S Nijjar set aside the order of Bombay High Court, which had in 2005 squashed the criminal case against the telecom giant Motorola and its directors.

"The Bombay High Court exceeded its jurisdiction and quashed the complaint. It should not have examined complex commercial documents in order to determine a case of cheating, which is made out even before the trial," the Bench said allowing the appeal of Iridium.

Iridium is a consortium of financial investors including IDBI, ICICI Bank, IL&FS and SBI, which entered into an agreement with Motorola in 2003 to provide satellite based phone services in India.

However, Iridium alleged that Motorola from the day one knew that the project was a failure and despite that took Rs 500 crore to start the project.

On such realisation, Iridium filed criminal cases against Motorola Incorporation and its five directors in Mumbai.

This was later challenged by Motorola before the Bombay High Court, which quashed the criminal cases against Motorola.

Following this, Iridium approached Supreme Court in 2005 to start criminal prosecution against Motorola and it five directors.