Law ministry to decide aviation company’s fate | mumbai | Hindustan Times
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Law ministry to decide aviation company’s fate

mumbai Updated: Dec 02, 2011 01:31 IST
Mohan K Korappath
Mohan K Korappath
Hindustan Times
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The fate of Cambata Aviation Private Limited, which handles the operation of aircraft ground and cargo handling services at the Mumbai airport, still hangs in the balance after the union government told the Bombay high court that the issue of entry permits for its staff has been referred to the law ministry.

The court had earlier granted an ad-interim relief to the aviation firm, which will be applicable till January 9. A response from the ministry of law and judiciary is expected by then.

According to Advait Sethna, counsel for the Bureau of Civil Aviation Security (BCAS), earlier this year, Cambata Aviation had made an application before the civil aviation ministry for the renewal of clearance for its staff to enter the airport, which is pending since August 2008.

However, while considering the application, the BCAS found that the shareholding pattern of the company did not comply with government rules.

Sethna said that four foreign nationals together held 96.8% of shares in the company, which was in contravention to Foreign Direct Investment (FDI) norms.

Cambata’s counsel Venkatesh Dhond said that according to the Reserve Bank of India, Persons of Indian Origin should be treated as Non-Resident Indians, and therefore, the shareholding pattern is in compliance with FDI norms.

The BCAS subsequently forwarded the matter to the department of industrial policy and promotion (DIPP). The DIPP then referred the issue to the law ministry for consideration.

The court noted that the firm offered its services to various airlines at the Delhi, Mumbai, Chennai, Ahmedabad and Pune airports. Its staff has already been granted Airport Entry Permits for entry to the Delhi International Airport till December 31, 2012.

The court also noted that the firm has been providing its services to the Mumbai Airport for the past 50 years.