CL-2022-000304 - [2025] EWHC 1553 (Comm)

Fecha: 20-Jun-2025

2009-2016

2009-2016

44.

The Tribunal summarised that in 2009:

“… RAKIA brought its investment up to US$42.5 million but did not thereafter match equity investments by Penna. As a result, its share of equity was reduced to about 12%.”

The references to equity were to equity shares in ANRAK Aluminium Ltd.

45.

The Tribunal commented:

“The recitals to the MoU might give the impression that RAKIA, with its ‘vast industrial experience’ as a ‘highly competent and financially sound entrepreneur’ was proposing at least to take the lead in investing US$2 billion and bringing the ‘best energy efficient and best Aluminium technology available in the world’ to Andhra Pradesh. In the event, however, it was an Indian company, [Penna Cement] which … emerged from the anonymity of being an ‘associate’ in the MoU and took a 70% interest in the equity of ANRAK [Aluminium Ltd]. RAKIA’s last investment was a payment of about USD$10m in August 2009, after which it appears to have adopted a ‘wait and see’ position and allowed its equity interest to be diluted by further issues of shares to Penna.”

46.

By an Agreement for Pledge of Shares dated 25 May 2010, RAKIA confirmed it pledged shares in ANRAK Aluminium Ltd in favour of Axis Bank Limited as security trustee acting for a number of lenders to ANRAK Aluminium Ltd.

47.

The Tribunal further summarised:

“Between 2010 and 2013 ANRAK [Aluminium Ltd] built an alumina refinery and captive power plant.”

In a little more detail, it added:

“On 17 July 2010 a committee of scientists from the [Ministry of the Environment and Forests] inspected the area for which APMDC [Ltd] had applied for forest clearance and the site on which ANRAK [Aluminium Ltd] was to build the refinery and smelter. The committee was surprised to see that the building of the refinery had already begun. On 8 November 2010 an official from the Ministry wrote to ANRAK:
‘The committee has reported that the construction activity for the project has already commenced and sufficient progress has been made. It is also noted that the Stage II Forest Clearance under the Forest (Conservation) Act 1980 for the Jarilla Mines has not been granted. Hence in the absence of forest clearance, there is no assured supply of bauxite for the proposed aluminium refinery.
In view of the above you are advised to stop further construction work for Alumina refinery for Smelter and Captive Power Plant till final decision is taken to grant Forest Clearance to the captive Jarilla mines.’
ANRAK [Aluminium Ltd] nevertheless carried on building the refinery …
The Ministry examined the question of whether such mining in a tribal area would be lawful … and on 3 October 2011 appointed a committee under the chairmanship of Mr JC Kala, former Director General of Forests, to advise on whether clearance should be granted.”

48.

The committee produced a report. The Tribunal’s summary of the report included the following:

“… the committee said that it had made efforts to obtain the views of all stake holders, ‘specially the local tribals’ but had not been altogether successful. … The Committee said that it had weighed the pros and cons. It noted that the ‘State’s record of providing development in the area has not been satisfactory. ‘But ‘the vicious cycle of poverty leading to ecological degradation and in turn more poverty can be broken only through development in the area.’ Accordingly it recommended that approval should be granted but that first ‘Gramsabha or the Panchayat at appropriate level should be consulted.’
The Ministry appears to have pondered this advice for another two years.”

49.

The refinery was completed in 2013.

50.

The Tribunal recorded:

“In December 2014 Mr James Buchanan, who had recently been appointed Chief Executive Officer of Ras al Khaimah Development Corporation, went to Hyderabad to see Mr Prathap Reddy of Penna:

‘During my meeting with Mr Prathap Reddy, he briefed me about the Project and his commitment to the Project. He remained confident of the government granting the necessary approvals required for APMDC [Ltd] to commence bauxite mining operations, as the Project was being supported by both the Central Government and the Government of Andhra Pradesh. He also informed me that his group of companies, who were also shareholders in ANRAK [Aluminium Ltd], were in the process of injecting almost USD 35 million between 2014 through 2015 in the Project.’

Mr Buchanan said he derived a ‘cautious level of optimism’ from these statements, although the level was not high enough to justify any further investment in the project until bauxite mining had actually begun.”

51.

The Tribunal summarised:

“On 17 August 2015 the [Government of India] granted Forest Clearance, the last important national clearance needed to enable APMDC [sic] to start mining bauxite. On 5 November 2015 the [Government of Andhra Pradesh] issued GOM 97 which gave effect to the Forest Clearance in Andhra Pradesh. However, after a good deal of public protest, the [Government of Andhra Pradesh] reversed itself and on 22 December 2015 the Chief Minister announced he would ‘cancel the BSA’
…
On 22 December 2015 there was a debate on bauxite mining in the Legislative Assembly … At the end of the debate the Chief Minister announced a U-turn: he proposed to cancel the BSA by revoking GOMs 222 and 289, the orders by which [the Government of Andhra Pradesh] had authorised APMDC [Ltd] to enter into it. …”