HC notice to centre on proposed airlines deal

The Delhi High Court Wednesday issued notice to the centre on a plea by BJP leader Subramanian Swamy, seeking that the government not grant approval for a deal between Singapore Airlines and the Tatas in a greenfield airline project.

A division bench of Chief Justice N.V. Ramana and Justice Manmohan sought responses from the Civil Aviation Ministry, Directorate General of Civil Aviation and others by Oct 30.

The BJP leader moved the high court seeking a restraining order to the government so that it would not approve investment of a foreign airline in a greenfield airline project like AirAsia.

Swamy filed an application in his pending PIL against AirAsia, claiming that the government is scheduled to consider another similar deal between Singapore Airlines and Tatas this month.

He sought a direction for "restraining the centre from taking any action or decision or granting any further or other approvals/permission/NOC/permits etc. contrary to the applicable FDI policy and DGCA guidelines or granting any approval for foreign investment by a foreign airline in a greenfield airline project".

Swamy had earlier filed a PIL challenging the clearance given to the proposed low-cost airline AirAsia India, alleging wrongdoing in the process.

He had claimed that, according to the policy, foreign investment was only permitted in an existing airline, but AirAsia India was not an existing carrier.

The court had issued notice to the centre, Foreign Investment Promotion Board (FIPB) and Commerce and Civil Aviation ministries.

The government March 26 approved Malaysian low-cost airline AirAsia's proposal to set up a new airline in India in partnership with the Tata Group and the Arun Bhatia-promoted Telestra Tradeplace.

On Aug 16, the Supreme Court had asked Swamy to move the high court with his plea.

AirAsia India will be based in Chennai, and the Malaysian carrier will hold a 49 percent stake in it.

Swamy opposed the clearance to the deal saying that according to government policy, FDI up to 49 percent is allowed in existing airlines already in operation, and not to new or proposed joint ventures.