Which airlines will benefit from India-UAE deal, asks SC

A bench led by Chief Justice T S Thakur decided to widen the scope of a PIL filed by BJP leader Subramanian Swamy, who has claimed that the alliance between Jet Airways and Abu Dhabi-based Etihad and the consequent seat sharing agreement between the two countries affected India’s interests adversely.

According to Swamy, the UAE airline is being favoured with additional air traffic rights while there is an estimated loss of over Rs 9,500 crore to the Indian exchequer. Etihad has 24 per cent stake in Jet Airways.

“In your petition, you (Swamy) have challenged only the MoU (Memorandum of Understanding). You should have also challenged the air traffic rights and seat sharing agreement. There is a need to examine which other airlines are unduly benefiting under treaty. We don’t have to confine it to only this deal,” observed the bench, also comprising Justice Uday U Lalit.

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It said the seat sharing pact may impact business interests of various other airlines, including state-run Air India, and asked Swamy to make other airlines parties to his petition so that the deal is opened to a wider scrutiny. Swamy concurred with the bench, saying he would add Federation of Indian Airlines (FIA), Air India, IndiGo and SpiceJet as parties in the case.

The court broadened the ambit of the 2013 PIL even as the Central government sought to defend the deal, asserting that the seat sharing arrangement was a part of an international treaty between two countries which cannot be gone into by filing a petition in the court.

Representing the Centre, Additional Solicitor General P S Narasimha based his argument on immunity accorded to an international agreement between two sovereign nations but the bench was not convinced.

“How can this agreement become a treaty? Not every agreement is a treaty,” retorted the bench, pointing out that the Centre was yet to adduce entire records before the apex court to show the nature of this agreement. “You (Centre) have not filed the entire thing. You are taking us by surprise,” it told Narasimha.

Swamy said he, too, was “surprised” that the BJP-led government was supporting a deal done by the UPA. “I am very much surprised why the present government is defending the UPA’s deal. I know that this deal was done to mollify the Emir of UAE who was hurt after the Supreme Court cancelled all 2G licenses, including those of his company,” said Swamy. The BJP leader said the Parliamentary sub-committee as well as the CAG had also opposed the Jet-Etihad agreement but the UPA government had done it to help Etisalat, which lost money due to cancellation of 2G spectrum licenses.

The case will be heard next on July 19. Swamy, in his PIL, has sought quashing of the deal on the ground that it was against public interest as there has been squandering of natural resource — sky and air space. He has questioned the Centre’s decision to execute the agreement in favour of Abu Dhabi under the existing Air Service Agreement between the governments of India and UAE, and the lion’s share of seats going to Etihad.