Govt changes Dabhol law firm midway, lands itself in a spot

Eversheds, the solicitors in London it selected to replace DLA, informed the UPA Government as late as September 14 that as they had earlier worked for General Electric (the US company has a 10 per cent equity in the Dabhol Power Project), they feared a conflict of interest and could not represent India.

While Law Minister H R Bharadwaj and Attorney General Milon Banerjee were not available for comment, the managing partner of the Indian law firm picked to handle India’s defence, Fox & Mandal, confirmed that they were facing difficulty in finding a replacement for DLA.

In London to look for solicitors, Som Mandal told The Indian Express: ‘‘Dozens of solicitors have been contacted, but a majority said they apprehended a conflict of interest. We have made a shortlist of solicitors and will try and firm up something soon.’’

Documents in the possession of The Indian Express show that the mid-course change was made in the Dabhol legal team—led by former attorney general Soli Sorabjee—despite advice from several quarters.

Sorabjee was had been asked to continue to lead India’s defence by the Prime Minister and the Inter-Ministerial Group (IMG) set up to assist in preparatory work for the arbitration but the Government later informed him about the new team. Sorabjee has written a five-page missive to the Committee of Secretaries, headed by the Cabinet Secretary.

The note reveals that the Government of Maharashtra had also expressed its ‘‘dissatisfaction’’ at the ‘‘unwise’’ move to replace DLA. Maharashtra Chief Secretary wrote to Cabinet Secretary B K Chaturvedi, expressing ‘‘great apprehension regarding the changes taking place in the legal team at the last moment.’’ Maharashtra also requested that the documents given to the Central Government and DLA should not be passed onto anyone else without their consent.

Sorabjee said that he agreed to continue working on the Dabhol case on a written request from the UPA Government and even visited London for it recently. But he says, ‘‘Changing the legal panel mid-course will certainly have an adverse effect on the expropriation claim and might put the Government in difficulty. I hope a competent solicitor is appointed in London and that the Attorney General will lead the arguments in the landmark case.’’

The background note sent by the IMG to the Cabinet on July 13 states: ‘‘Our counsel feel that the case made out by GE/ Bechtel before the international tribunal in London is plausible, and that the Government will need to put in considerable efforts to counter the allegations.’’ This 15-page note and the note for Committee of Secretaries (also sent as a supplementary note to the Cabinet) reveal this sequence of events:

• On July 5, after a meeting, the Committee of Secretaries decided that the legal advisers and counsel appointed during the tenure of the NDA government be asked to continue.

• On July 14, the Finance Secretary wrote to the Law Secretary that Sorabjee be asked to continue, and that this had the approval of the Prime Minister. The alternative suggested was Solicitor General G Vahanavati, since he had dealt with the Dabhol cases when he was advocate general of Maharashtra.

• In mid-August, the Law Ministry recommended that a fresh legal team be appointed. On August 28, the Attorney General held a meeting with the IMG and Maharashtra government officials and directed that no witnesses should proceed to London. Tickets to London for six witnesses had been booked for the September 1-15 schedule.

• The Ministry of Finance (MoF) then received a note from the Law Secretary asking that the English solicitors, DLA, be ‘‘immediately’’ replaced with Eversheds, and that the Queen’s Counsel (QCs) assisting India be de-instructed. Only Sir Arthur Watts, QC, was to be retained.

• On August 30, the MoF informed the Committee of Secretaries that the expenditure incurred on the work done by DLA, to the tune of Rs 3.5 crore, would be ‘‘wasted’’, and that a replacement of solicitors would considerably increase expenses on the litigation and would result in a ‘‘weakening of India’s ability to defend the case’’.

• On September 14, the MoF told that Eversheds had declined to be part of the Dabhol litigation since there was a conflict of interest involved. The MoF sent a note to the Ministry of Law asking for an inquiry into how the concurrence of Eversheds was earlier intimated to them, to which there was no reply.