ABOUT This ebook is an attempt to make available all the information on the 2G Spectrum Scam to the people.

Apart from exclusive articles, the book also has links to all the relevant official documents that shed more light on the wrongdoings in the Telecom Ministry. This book does not contain details of CBI investigation and court proceedings that are underway. WHY THE eBOOK According to a recent report released by an online audience measurement tool, about 77 per cent people in India have read about the 2G Spectrum Scam on the Internet between August 2010 and January 2011. ViziSense, which measured internet usage patterns, said

that internet has played a major role in creating awareness about scam related news by providing the readers more details and facts about them. Keeping this in mind, a website -- www.2gscam.in -was launched with an objective of providing a one-stopshop for all the information and news developments related to this mega scam. You can log on to the website (mentioned above) to track developments on the subject. You can also keep in touch with the website by becoming a fan of 2G Scam website on the Facebook (www.facebook.com/2GScam)

CONTENT
1. Telecom scam: Who is the real Natwar? (November 2, 2009) 2. Tapping, trapping and Telecom Scam (April 28, 2010) 3. 2G Spectrum Scam: Timeline of Rajas dubious role (April 30, 2010) 4. This, is "News" (May 15, 2010) 5. Details of CAG report on 2G scam (October 30, 2010) 6. Is Ratan Tatas SC petition on 2G tapes a bad strategy? (November 29, 2010) 7. 2G Spectrum Scam: Why is BJP demanding a JPC? (December 3, 2010) 8. 'Ratan T ata sho uld have igno red Chandrasekhar's letter (December 10, 2010) 9. Telecom Scam: Is Swan Telecom being let off? (December 30, 2010) 10. 2G Scam and Sibal's strange arguments (January 17, 2011) 11. Questions over Batcha's death (March 16, 2011) 12. Excerpts from PAC Report 1 (June 29, 2011) 13. Excerpts from PAC Report 2 (June 29, 2011) 14. PM speaks on 2G Scam (June 30, 2011) 15. Excerpts from PAC Report 3 (July 5, 2011) 16. Excerpts from PAC Report 4 (July 19, 2011) 17. 2G and Pranab's 'secret note' (August 2, 2011)

DOCUMENTS
1. PAC Report on 2G Spectrum Scam 2. PAC Recommendations on 2G Spectrum Scam 3. 2G Scam: Communication between the PM and Raja 4. Rajeev Rajeev Chandrasekhar's letter to the CBI on illegalities in the issuance of new UASL licenses 5. Rajeev Chandrasekhar's Letter to the CBI on illegal grants by DoT 6. Complaint to the CVC regarding cleanchit to Swan Telecom MoCA on Swan - Reliance Connection 7. MoCA on Swan - Reliance Connection 8. Statement of Niira Radia before the CBI 9. PMO affidavit in SC regarding 2G Spectrum Scam 10. 2G Spectrum Scam - Final CAG Report 11. Rajya Sabha MP Rajeev Chandrasekhar's Response to Ratan Tata's Letter 12. Ratan Tata's open letter to Rajya Sabha MP Rajeev Chandrasekhar 13. Rajeev Chandrasekhar's open letter to Ratan Tata

14. Rajya Sabha MP Rajeev Chandrasekhar's Letter to the PM 15. Pratham Pravakta cover story on Telecom Scam 16. CBI ACB Report on 2G Spectrum Scam 17. CVC Complaint

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Telecom scam: Who is the real Natwar?

text One of the companies under the Central Bureau of Investigation (CBI) scanner, which is probing the alleged 2G spectrum scam, has also figured in an earlier complaint to the Central Vigilance Commission (CVC) filed in February this year. The CVC received a complaint this year against the Telecom Minister, and the officials of the Telecommunications Ministry who were involved in the decision of giving telecom license to Reliance Communication on 18 October 2007 and to other companies on 10 January 2008 under the first cum first serve policy. The complainant, which details the role of Swan Telecom Ltd, alleged that the licenses were given at a price that was much below the market price. He even alleged that the difference amount was shared between the people involved. Apart from the fact that the telecom licenses were given at lower prices, the most important piece of information that the complainant has revealed is who owned Swan Telecom and who actually benefited from the sale of those licenses to other companies at a higher market price later. Meanwhile, the current investigations by the CBI has resulted into allegations of corruption by various political parties. While the Prime Minister has backed the Union Telecom Minister Andimuthu Raja, the BJP has demanded his resignation for his role in the scam, which runs into thousands of crores. Raja, on the other hand, has accused the NDA government of being involved in a Rs 160,000 crore spectrum scam by distributing free spectrum to operators. The entire controversy erupted after the CBI initiated a probe on the request of the CVC. The CVC requested for a comprehensive probe as it found that spectrum was not allocated at the market price and no auction process was followed. Click here to read the complaint filed with the CVC regarding the telecom scam blog comments powered by Disqus 1 year ago Central Vigilance CommissionCBI ProbeTiger TrusteeReliance CommunicationsAnil AmbaniSwan Telecom2G Spectrum Scam2G Scam

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Tapping, trapping and Telecom Scam

text The recent IPL controversy and the subsequent resignation by former Union Minister of State for External Affairs Shashi Tharoor has exposed the double standards of the UPA Government. While Tharoor was made to resign over allegations of committing financial impropriety, no action has been taken against the architect of one of the biggest scams in the Indian history. Despite mounting evidence against Telecom Minister A Raja about his controversial role in allocation of 2G spectrum to firms at a price much below the market price, the UPA government appears to be shielding him. Rajas decision to grant new licenses resulted in a loss of around Rs 60,000 crores to the national exchequer. The Central Vigilance Commission (CVC) issued a showcause notice to Raja in November 2008. It also demanded his prosecution in the case. Following this, the Central Bureau of Investigation (CBI) registered an FIR on October 21, 2009 under various sections of the Prevention of Corruption Act. The agency is investigating allegations into criminal conspiracy between certain public servants and private individuals in granting of these licenses in 2007-2008. The role of certain middlemen, including Nira Radia, who according to the CBI were actively involved in this criminal conspiracy, came under the scanner of the agency. As a part of the investigation the agency sought information from the Directorate General of Income Tax about the middlemen, including Radia, an influential lobbyist who runs an communications consulting firm called Vaishnavi Communications. She also runs Noesis Consulting, Vitcom and Neucom Consulting. Noesis comprises of retired bureaucrats and is involved in consulting in various sectors like Telecom, Power, Aviation, and Infrastructure. The phones of Nira Radia and her associates were placed under surveillance by the Finance and Home Ministry for a period of 120 days in 2008 and 180 days in 2009. The intercepted calls pointed towards collusion between Radia, certain officials of the Telecom Ministry, and some telecom operators. It also suggests that a large number of confidential documents and policy papers found its way to Radia. Documents available with 2GScam.in reveal that CBI DIG Vineet Agarwal had
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sought call detail records of Nira Radia and some other middlemen from Directorate General of Income Tax through a letter on November 16, 2009. The details that emerged from that call records are simply shocking. 1. The telecom intercepts suggest that Radia had a role in managing policy changes at the highest levels of government, including those leading to the award to telecom license to Unitech Wireless, Swan Telecom, Aircel, and Datacom. Swan Telecom Pvt. Ltd. bagged an allotment of licenses in 13 circles worth Rs 1537 crore. Within weeks of bagging the licenses, the company sold 45 percent stake to Etisalat (UAE company) for Rs 4500 crore. Unitech got licenses for 22 circles for Rs 1651 crore. It later sold them to a Telenor (Norwegian company) at a whopping sum of Rs 6120 crore. Unitech had applied for licenses in several names (Unitech Infrastructure, Unitech Builders and Estates, Aska Projects, Naham Properties, Hudson Properties, Volga Properties, Adonis Projects and Azare Properties among them). They merged all their licenses when Raja signed a dubious notification allowing this to happen. This paved the way for a foreign firm, widely operating in Pakistan and Bangladesh, to enter the Indian telecom industry. This clearly exposes UPA governments lax attitude towards national security. 2. Some conversations suggest that Telecom Minister A Raja and Radia too have equity interest in Swan Telecom. 3. The intercepted calls also exposed the extent of lobbying done for ministerial berths and the helplessness of none other than the Prime Minister in preventing corrupt people from occupying high offices. The recorded conversations reveals that a top businessman, with interests in various sectors besides telecom, wanted to prevent Dayanidhi Maran from becoming the Telecom Minister. Whereas, another top businessman with primary interest in telecom, was lobbying to prevent Raja from becoming the Telecom Minister. Given Rajas dubious record, it seemed unlikely that the PM would have accommodated him in his cabinet again after winning the 2009 Lok Sabha polls. But Raja not only made it to the cabinet, he also got the Telecom Ministry. According to some conversations, two top news editors (one a Padma Sri awardee, and another who also does lifestyle TV shows) lobbied with the Congress leaders on
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behalf of Radia to get ministerial berths for DMK MPs, especially Raja. 4. Another conversation between Radia and Unitechs Ajay Chandra relates to the sale of equity by United to Telenor as a higher price, thus making huge profits. The discussion is about the governments investigation into the telecom license issue. According to an internal investigation report, the crux of the conversation is to stagger the inflow of funds and to give an impression to the government that the funds have come only into the telecom company and there is no windfall gain to the promoters of Unitech. 5. The phone tapping exercise also revealed that Radia is spreading business connections to Africa, including investments in Guinea and Senegal through Global Minerals. 6. The conversations of Radia and her associates also suggest their role in laundering and structured payoffs, and liaisoning for telecom and power projects. The CBI inquiry so far has put the government on the back foot. As a result, the man who was leading the investigations into the scam was transferred. So, is the removal of Vineet Agarwal a part of the governments efforts to bury the inconvenient facts that has emerged from the inquiry till now? CBDT reacts on phone tapping Meanwhile, the Central Board of Direct Taxes (CBDT) has issued a clarification on interception of telephonic conversations of the above mentioned individuals. Take a look: A section of the media has reported communication between the Income Tax department and the Central Bureau of Investigation regarding records of telephonic conversations between a person by the name of Nira Radia and others. It is also reported, citing sources in the CBI, that in addition to Radia, telephone lines of several other influential business-men, politicians and advertising professionals were tapped. The Central Board of Direct Taxes (CBDT) has clarified that the Income Tax department has not recorded any telephone conversation of influential businessmen, politicians and advertising professionals as alleged. It is further clarified that the Income Tax department does not intercept telephonic
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conversations except as authorised under the law. The provision is used in rare and exceptional cases of suspected tax fraud / evasion involving security of the state. The procedure, as prescribed under the law, is strictly followed in all such cases. (BY/KP/GN-150/10 April 28, 2010) blog comments powered by Disqus 1 year ago 2G Spectrum2G Spectrum ScamCentral Vigilance CommissionNiira RadiaNira RadiaRadia TapesIndian MediaBarkha DuttVir SanghviNewsXA RajaUPA GovernmentSwan TelecomAnil AmbaniUnitechVineet AgarwalUnified Access Services ScamTiger TrusteeReliance Communications

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2G Spectrum Scam: Timeline of Rajas dubious role

text The 2G Spectrum Scam is once again in news with media reports of the phone conversation details of top corporate lobbyist Nira Radia establishes Telecom Minister A Rajas dubious role in awarding telecom licenses at a price lower than the market price. 2GScam.in brings you this timeline of Rajas dubious role in the entire issue. May 16, 2007: A Raja was appointed as the Minister for Communications in Manmohan Singhs Cabinet. August 28, 2007: The Telecommunications Regulatory Authority of India (TRAI) set out detailed recommendations, primarily urging the government to determine the market prices of Spectrum licenses through a competitive mechanism, by auctioning to the highest qualified bidder. August 28, 2007: The Ministry of Communications, Department of Telecom (DoT), with A Raja as minister rejected the aforesaid TRAI recommendations; and insisted on following the earlier 2001 policy regarding pricing of Spectrum licences (i.e. licenses were to be allotted at fixed June 2001 licence fees, on a first-come-first served basis). In 2001, there were only 4 million cellphone subscribers; whereas by 2007-2008, the number of cellphone subscribers was around 350 million. Thus by fixing license fees at 2001 prices, the Telecom Ministry enabled companies that were allotted licenses to command huge premia. September 20-25, 2007: Rajas old cronies, notably Unitech, Loop, Datacomm, and Swan (all of whom had had dealings with certain companies floated by his family), applied for the 2G Spectrum licenses. Unitech and Swan had no previous experience in the Telecom indushttp://www.2gscam.in/post/9551037919/2g-spectrum-scam-timeline-of-rajas-dubious-role Page 1 of 3

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try. December 2007: Two officers who had vigorously opposed the aforesaid DoT Policy (the Finance member and the Secretary of DoT) resigned/retired from government. The two others who had opposed undue favours to Swan were transferred. This cleared the way for an objection-free allotment to Rajas cronies. January 1-10, 2008: Siddhartha Behura, Rajas former Secretary in the Environment Ministry, was appointed Secretary of DoT. Ignoring Law Ministry notings urging that the matter be first vetted by a Group of Ministers, DoT issued its nine coveted licenses within 10 days (before Jan 10, 2008), mainly to the above mentioned four crony firms. This was done: In the teeth of notings regarding revenue losses to the government After unilaterally pre-poning the application deadline to September 25, 2007 September-October 2008: Swan sold 45 percent of its shares to Etisalat (a United Arab Emirates company) for $900 million (in 2008 around Rs 4,200 crores). The company had obtained its license for Rs 1537 crores. Unitech Wireless sold 60 percent of its shares to Telenor (a Norwegian company) for Rs 6,200 crores. Unitech had bought its only asset, the spectrum license, from DoT for Rs 1,661 crores. Tata Teleservices sold 26 percent of its shares to DoCoMo (a Japanese company) for Rs 13,230 crores. Based on the aforesaid sale of shares by Unitech and Swan, the market value of these 9 new 2G licenses amount to a total of Rs 70,022.42 crores, for which these 9 companies/conglomerates had paid DoT a total of Rs 10,772.68 crores. Thus DoT lost the difference, amounting to Rs 59,249.74 crores. Thus, by selling these 9 licenses at the lower price Raja caused a loss in the range of Rs 60,000
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crores to the Indian exchequer. November 15, 2008: The Chief Vigilance Commission issued a showcause notice to Raja. Thereafter, on the basis of his investigation, the Chief Vigilance Commissioner sent a detailed report to Prime Minister Manmohan Singh, reiterating the demand for Rajas prosecution. October 21, 2009: The CBI registered an FIR in the scam. November 29, 2008, October 31, 2009, March 8, 2010, March 13, 2010: Dr Subramaniam Swamy wrote to the PM, demanding sanction to prosecute Raja. In the last letter, he pointed out that the Supreme Court on March 12, 2010 (in the governments SLP) had refused to interfere with the Delhi High Courts two judgments quashing the government allocation of the 2G Spectrum. March 19, 2010: The Indian governments Department of Personnel wrote to Swamy that it would be premature to consider sanction for prosecution at this stage because evidence collected still being perused. April 12, 2010: Swamy filed an instant Writ Petition with the Delhi High Court. April 28, 2010: Details of tapes establishing Rajas dubious role in the scam surfaces in the media. Opposition parties demanded that the PM sack Raja. blog comments powered by Disqus 1 year ago A Raja2G Spectrum2G Spectrum Scam2G ScamTelecommunications Regulatory Authority of IndiaTelecom MinistryNiira RadiaNira RadiaUnitechSwan TelecomDepartment of TelecomEtisalatTata TeleservicesDoCoMoTelenor

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This, is News
text BY MANOJ KEWALRAMANI This, he said with a determined look, before pausing for a moment. Is news, he continued, as the screen faded into darkness. Thats as honest as one can be these days, I thought, with the image of Ryan Seacrest hosting E! News still in my head. Perhaps its a reflection of just how cynical I have become or perhaps its just a measure of how the trade has evolved. Yes its a trade; its always been one. All it has done is metamorphosed from the practice of a skill to the far more realistic you-scratch-my-back-and-I-scratch-yours stage. Nah, thats a dirty phrase. It just trivializes the effort that goes into sustaining the mystique of morality while manufacturing opinion. Its an art; it always was and still is. Its an art to howl aloud clichs like your views your call your channel your paper and pretend to be your conscience while still selling you a product that you dont even know you are consuming. Truly, it is an art, an art that perhaps those in PR circles would describe as environment management. And with the way we live today, the degradation of the environment with each passing day should hardly come as a surprise to us. No money, no news, is how noted journalist P Sainath described the scenario during the Maharashtra elections last year. Painting a grim picture, he added: The game has moved from the petty personal corruption of a handful of journalists to the structured extraction of huge sums of money by media outfits. But thats just the tip of the iceberg an iceberg that perhaps began melting publicly when the cash-for-votes scam hit Parliament. As journo after journo and channel after channel debated the new low that the legislahttp://www.2gscam.in/post/9551275889/this-is-news Page 1 of 3

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ture had sunk to, there was hardly any discussion about the behind the scenes tapes and recordings that seemed to exist but didnt see the light of day. Political favour you presume? Well most certainly. But a better answer can perhaps be found in the convoluted books of accounts and the equity structure or even something as simple and transparent as the advertising contracts. Still not convinced, youd probably scoff and parrot the old adage of everybody needing to run a business one way or the other. Whats more, being a little stingy with the truth is a bargain that maybe you can live with. Fair enough, perhaps we can; and perhaps sometimes its better for the health of a crumbling edifice, that is our system and our faith in it, to not let the hammer strike it with full force. But then, thats acceptable if only the rot had decided to limit itself till where it was. In reality though, the spectrum (pun intended) it covers is far wider and far deeper. While the Telecom Minister may hang on to his chair, courtesy the limitations of coalition politics or rather the dire need of those who want him there, the real question is how did he, with a murky track-record, get the job in the first place? By now, of course we are all familiar with the tale. Boys meets girl. Boys hire girl. Girl pushes their agenda through a complex mix of favours and persuasion. A few hiccups later, the Raja is seated on the much-vaunted throne. Its just poetic justice how the story of the great Telecom battle of 2009 was narrated through taped conversations. Its a familiar script, but the devil lies in the minor details. In that story, this may have been a miniscule sub-plot, but in the larger scheme of affairs, it is anything but a small deal when noted journalists get named in confidential reports for lobbying to get the right man in the right place. And thats just how the system works. You cover not at the behest of public good, freedom, accountability and maintaining a check on the way things are. You cover as per the requirements of your balance sheet, or at least the ones who are keeping it balanced. Thats what it generally means when the bold Exclusive flashes on your screen.
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Theres a price to be paid for such exclusivity. In our world today, that price is ethics and independence. The last time I somberly told a journalist friend of mine about this fact, he turned to me cherry-faced, accusing me of pedaling sanctimonious bullshit that doesnt survive the test of reality. I didnt have an answer then, but I do today. Read through the article again and then tell me who it is thats being real and who it is that bellows holier than thou crap like trust, honesty, credibility, truth, 247. (Manoj Kewalramani is a guest writer with 2GScam.in. He has worked with top media houses like NDTV before becoming an Independent Blogger and Writer.) blog comments powered by Disqus 1 year ago 2G Spectrum2G Spectrum Scam2G ScamRadia TapesNiira RadiaNira RadiaBarkha DuttVir SanghviIndian Media

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Details of CAG report on 2G scam

text The Supreme Court of India has rapped the premier investigating agency, Central Bureau of Investigation (CBI), for conducting a slipshod investigation into the 2G Spectrum Scam. The Apex court took the CBI to task by stating that the agency was dragging its feet in the investigation. The SC is hearing two petitions in the matter. The first was filed by an NGO, Centre for Public Interest Litigation (CPIL), and the second filed by Janata Party chief Subramanian Swamy. Swamy had challenged the Delhi High Court order that rejected his plea to direct the PM to grant sanction to prosecute Telecom Minister A Raja. CPIL has placed before the Supreme Court two draft reports of the Comptroller and Auditor General (CAG), which pointed out that the 2G scam has caused a loss of over 1 lakh crore to the exchequer. 2GScam.in brings you some important extracts of the CAG draft reports, which directly points a finger of suspicion towards Raja for alleged irregularities and favoritism in the allotment of spectrum. Despite all agencies having full knowledge of scarcity and under pricing of spectrum, the entry fee for issue of licenses continued to be pegged at 2001 rates even in 2007 without delinking and independently pricing spectrum through a market mechanism, when the entire scenario in the telecom sector had transformed in the meanwhile. Ignoring the advice of the Prime Minister, and the Law Ministry, Raja went ahead with arbitrarily deciding that the cut-off date for issue of LoI would be advanced to September 25, 2007 and the applications received would be decided on first-come-first-serve (FCFS) basis. The CAG report states that it was amply demonstrated between September 2007 and December 2008 that its (spectrum) demand in view of its scarcity was at its peak and thus would have fetched the market determined price at a much higher level than that of 2001 entry fee. If price is calculated at 3G rates, which also be taken as one of the indicators for assessing the value of 2G spectrum allocated to UAS licensees in 2008, the value works out to Rs 111,511 crore against Rs 9,012 crore realised by DoT. Similarly, for spectrum allocated under the dual
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technology as referred in earlier para the value would have been Rs 40,526 crore, as against Rs 3,372 crore collected. The total difference in value worked out to Rs 139,652 crore. It was evident that at the time of applying for UAS licence the substantial equity of M/s Reliance Telecom Ltd in M/s Swan was 10.7%. Since M/s Reliance Telecom Ltd. were operating in all the service area for which M/s. Swan Telecom Ltd. has applied for USAL, their application was not in conformity with clause 8 of UASL Guidelines, and hence was not eligible to be considered. DoT did not have any mechanism to verify the correctness of the shareholders pattern of the applicant and hence the matter should have been referred to the Department of Company Affairs as was advised by the Finance Wing of the Department. No Reference, however, was made to the Department of Company Affairs and instead M/s Swan Telecom was given an opportunity to resubmit a revised stake holding pattern in December 2007 i.e. 9 months from their date of application which declared that M/s Reliance Telecom had divested their entire stakes. This was accepted by DoT and M/s Swan Telecom was given the benefit of seniority form the date of their initial application i.e. March 2007. As M/s Swan did not meet the eligibility criteria on the date of application, its application, its application should have been rejected by the department and the company should have been asked to apply afresh. Even if it is was to be considered eligible on the basis of its old application, the date of priority based on FCFS basis should have been revised from March 2007 to December 2007 in order to ensure fairness. Had it been so, the company would have been out of the race as the department processed only those applications which were received up to 25.09.2007. It was noted that the priority list was adjusted in Punjab and Maharasthra service areas to give under advantage to M/s Swan Telecom Pvt. Ltd. in allocation of spectrum. In Punjab service area, 15 MHz GSM spectrum was available in September 2008 which was sufficient to meet the demand of only first three applicants in the priority list i.e. M/s HFCL, Idea Cellular Ltd. and Unitech Wireless Pvt. Ltd. The request of M/s Idea Cellular Ltd. who was at the second place in the priority list was, however, not considered on the grounds of its merger with M/s Spice who were offering service in Punjab service area. By keeping out M/s Idea from the priority list, spectrum was allocated to M/s Swan Telecom who was at the 4th position on the priority list. In identical situahttp://www.2gscam.in/post/9551372719/details-of-cag-report-on-2g-scam Page 2 of 5

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tion in Maharashtra service area, M/s Spice Communications was not allocated start-up spectrum citing its merger with M/s Idea Cellular Ltd. Here too, the resulting beneficiary was M/s Swan Telecom Pvt. Ltd. Deviation from a Cabinet decision should normally be with the approval of Cabinet. However, in the present case, such a crucial decision to permit service providers to offer access services using combination of technologies (CDMA, GSM and/or any other) under the same license with the dual spectrum allocation was taken without the matter being referred to Cabinet. DoT has given a list of operators who could attract foreign investments, consequent to the grant of UAS licenses in January 2008 as in the Table below (Table not included in the post). Out of the above six, three companies viz M/s Swan Telecom, M/s S Tel and M/s Unitech were new entrants in the telecom sector. The fact that these operators could draw huge foreign investment, even before establishing a foothold in the Indian Telecom market would suggest that acquiring UASL and with it, allotment of 4.4 of GSM spectrum for rollout, was the main factor which attracted the foreign investment. The Unitech Wireless Services, claimed in their letter to DoT on November 4, 2008 that M/s Telenor was partnering with them at a stage when about 6 months of effort and Rs 2,100 crore expenses had already been put in and the entitys value was not only that of spectrum. However, considering that Telenor is an established international provider of a high quality telecommunications, data and media communication services and one of the Norways largest companies owned 54% by the Norway Government what they would have required to run their business in this country was, primarily access to the spectrum. Considering its trained manpower strength in 12 countries, its long standing technical expertise and international experience of dealing in telecom business, it can be convincingly concluded that, the high value paid by them was primarily for the spectrum and not for other inputs claimed to have been infused by Unitech. Such huge equity infusion by the investor company was a price that they paid for 2G spectrum which was allocated to Unitech, a company with no experience in telecommunication sector, at a throw away price DoT. The value which should have accrued to the new licensees in the form of huge capital infusion for enriching their business. The entire process of spectrum allocation was undertaken in an arbitrary manhttp://www.2gscam.in/post/9551372719/details-of-cag-report-on-2g-scam Page 3 of 5

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ner. The Honble prime Minister had stressed on the need for a fair and transparent allocation of spectrum, and the Ministry of Finance, and the Ministry of Law and Justice had sought for the decision regarding spectrum pricing to be considered by an EGoM. Brushing aside these concerns and advices, the Development of Telecommunications, in 2008, proceeded to issue 122 new licenses for 2G spectrum at 2001 prices, thus flouting all rules and procedures to be followed for spectrum allocation was also unfair, considering the fact that DoT introduced in artificial cap, arbitrarily changed the cut-off-date for receipt of applications post facto and altered the conditions of the FCFS procedure it had been following, thus creating an environment which cannot be perceived as transparent and fair. Dual Technology was introduced by DoT in a manner, which was in contravention of the Cabinet decision of 2003, resulting in additional spectrum being allotted to certain operators at 2001 price. Also by introducing unfair adjustments in the priority list, DoT favoured certain operators. Given its scarcity value and increasing demand, a comprehensive evaluation of available spectrum was required which was not done. With the UAS policy and its subsequent amendments being implemented in a weak and indeterminate manner and with the reluctance on the part of DoT to address the issue of pricing of 2G spectrum, it was only natural that 2G spectrum was allocated at much below its value. The Honble MoC&IT for no apparent logical or valid reasons ignored the advise of Ministry of Law, and Ministry of Finance, avoided the deliberations of the telecom Commission to allocate 2G spectrum, a scarce finite national asset at less than its true values on flexible criteria and procedures adopted to benefit a new operators. TRAI, the regulator also stood by as a helpless spectator when its recommendations were being either ignored or misused. The CAG draft report also mentions a note (Dated: January 15, 2008) sent to the PM by the Finance Ministry, which says that the previous issues of licences be treated as a closed chapter and henceforth price of spectrum be discovered through an auction process. This reveals the casual approach within the UPA Government towards this mega-scam, which resulted in a loss of Rs 139,652 crore to the exchequer. Despite mounting evidence (from CVC, CAG, CBI) of blatant corruption A Raja still presides over the Telecom Ministry. While Prime Minister Manmohan Singh headhttp://www.2gscam.in/post/9551372719/details-of-cag-report-on-2g-scam Page 4 of 5

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ing one of the most corrupt governments in our country post-Independence seem helpless in taking action against Raja because of the electoral considerations for the assembly polls in Tamil Nadu due to take place in 2011. blog comments powered by Disqus 10 months ago CAG ReportCAGCAG Report on 2G Scam2G Spectrum2G Spectrum Scam2G ScamA RajaAnil AmbaniCBI ProbeCentral Vigilance CommissionManmohan SinghDepartment of TelecomUnitechSwan TelecomTata Teleservices

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01/09/11 8:00 AM

Is Ratan Tatas SC petition on 2G tapes a bad strategy?

text BY ARUN AGRAWAL Watching the Ratan Tata interview with Shekhar Gupta made one wonder as to whether both of them were gullible enough not to understand the significance of the Radia tapes or were they playing to the gallery in the adult version of WWF. One suspects that it was a bit of both with Ratan Tata being more on the gullible side and Shekhar on the WWF side playing the game. There are a number of questions that Mr Ratan Tata needs to answer. The first and foremost relates to the need for the House of Tatas to engage a professional lobbyist and media manager instead of having a in-house media department. Obviously lobbyists are a necessity because there are lot of things that a professional lobbyist and media manager can do which the corporate cannot. And if you are caught with your pants down you can always disown them as is done invariably on the ground that the lobbyist exceeded his/her brief. Is that the reason why a lobbyist like Ms Niira Radia was employed? The second and the more important question relates to the significance of the fact that Ms Radia was not acting for the House of Tatas exclusively. She was acting on behalf of any and everybody including herself and surprisingly also the Minister! Did Mr Tata realize the consequence of the other relationships that Ms Radia had developed? If Tatas do not share the culture of either Reliance or Unitech, how can they share the same lobbyist? The fact of the matter is that Radia needed the House of Tatas as much the Tatas needed her. That gave her respectability and credibility to solicit/get solicited by other clients and also to do deals for herself. Is it not a fact that Tatas were not the innocent victim as is the case in most scams of corruption but were the innocent beneficiary of the corruption in the telecom scam. In fact they were the largest beneficiary. Is it not a fact that in the process of obliging Anil Ambani with a GSM license in exchange for transfer of Swan Telecom, Raja had to give the Tatas too the GSM license
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at the discounted price of Rs 1650 crores. Twenty-six percent of the shares of holding company of the Tatas, which got the license, was sold to DOCOMO for $2.7 billion, giving the license a value of $10 billion. The bottom line: 26 percent of what was bought for Rs 1650 crores by the Tatas was sold for over Rs 13,000 crores. This was almost three times the valuation obtained by Swan Telecom or Unitech.. On paper, the House of Tatas benefited the most from the Telecom scam. Should Ratan Tata, then, be eternally grateful to Ms Radia for making it possible? For any decent human being the answer would be a resounding YES. And Ratan Tata, like the Honble Prime Minister Manmohan Singh, is more than a decent human being. So while the Honble PM maintains his silence over Raja, Mr Ratan Tata goes out on a limb to defend Ms Radia. And yet, Ms Radia had nothing to do with the GSM license given to the Tatas. They were the unintended beneficiaries of the Anil Ambani scam because they were in the same CDMA boat. Was it possible to have one set of laws for Anil Ambani, in the give one get one scam in which license was given to RCom and Swan Telecom, and have another law for not giving a license to Tata Teleservices? In fact Tata Tele applied for the license on 22/10/2007, after Reliance Communication got the license on 18/10/2007. Tatas had to be given the license/spectrum because there could be no discrimination. Otherwise it would go to Court as they actually did for the allotment of the spectrum in the circles where there was scarcity of spectrum. Where does Ms Radia fit in? Nowhere! Ms Radia was into her own scam with the Minister. She was dealing for everybody, including herself. Is it not true that money was transferred to Unitech group by the Tatas at the behest of Ms Radia? How much money did she make in helping others make money? Who were the parties who made money because of her? How much money did each one of them make? Did she have any stake in any of the licenses? These are matters of investigation. The fact of the matter is that Ms Radia too had a personal stake in Raja retaining the telecom portfolio. And her personal stake was larger than that of the Tatas at the material time.

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Unitech too got a license and was reportedly her client. Tata Realty gave a loan of Rs 1700 crore to Unitech in early 2008 at a time when the license was actually given (10/1/2008). Was it to facilitate the license or/and the bribe? Was it not done because of Radia? What if it is discovered that bribes were paid by Unitech? Could not the Tatas be accused of a three way deal, given that Tata Tele benefited the most? And the fact that the loan was never repaid but properties were transferred by Unitech. (Unitech could not return the loan and instead sold subsidiaries having land in Gurgaon to Tata Realty.) Would it then be unreasonable to conclude that Tatas may not be giving bribes but they need lobbyist like Ms Radia who facilitate bribes? The facts narrated above are not from the Radia tapes. These are in the public domain and the conclusions drawn are logical. It is for these reasons that Mr Ratan Tata should realize that it is the tapes that will prove his innocence/guilt. So far, the tapes that are in public domain are not damaging to him. If he approaches the Court then people will feel that he has something to hide along the lines suggested above. Like the paradox of the Tatas having benefited the most from corruption, the House of Tatas benefit the most by the tapes remaining in the public domain.. Let there be transparency if there is nothing to hide. Like the judges who voluntarily declared their assets. It is a sting operation or a leak which happens all the time. In fact it is the stuff that lobbyist Ms Radia uses routinely. Leaking policy papers, influencing policy and even cabinet posts is what the lobbyist do for a living and those engaging them pay for. If the House of Tatas did not see any wrong in appointing a lobbyist and benefiting from leaked information then why squeal now when the tapes are leaked? What happened to the level playing field? Ratan Tata would be well advised to sack the lobbyist, withdraw the petition from the Supreme Court and let the tapes remain in the public domain. Otherwise he risks damaging his reputation forever which will be a sad thing. As for the tapes, they will remain in public domain (the Internet is too vast to be covered by a court injunction). Disclosure: The author believes that the House of Tatas is one of the few honest corporate houses of the country and should not get involved with lobbyists, more so
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when they also lobby for other companies with dubious reputation. The author holds Ratan Tata in high regard and is a well-wisher. The post has been written in good faith. (PS: India is becoming a banana republic, Ratan Tata said in the interview. The aam aadmi knows that its been one for years.) (Arun Agrawal is the author of the book Reliance: The Real Natwar) blog comments powered by Disqus 9 months ago 2G Spectrum2G Spectrum Scam2G ScamRadia TapesNiira RadiaNira RadiaRatan TataTata TeleservicesDoCoMoSupreme Court of IndiaUnitech

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2G Spectrum Scam: Why is BJP demanding a JPC?

text The logjam in the parliament over the demand for a Joint Parliamentary Committee (JPC) probe into the 2G Spectrum Scam does not seem to end with the Opposition parties not budging from their demand. The Congress Party and the UPA Government is also in no mood to oblige the Opposition on their demand for a JPC. The deadlock in the parliament over the issue has resulted in the loss of 16 working days. The government has held several All-Party meets to resolve the issue without any success. 2GScam.in brings you details of why the government and the Opposition are not willing to compromise on their stands. The Congress top brass, including Sonia Gandhi, Prime Minister Manmohan Singh, Pranab Mukherjee, and Ahmed Patel met on November 16 in the office of the Congress President at the Parliament Annexe, sources said. It was decided in this meeting that the government will stick to its stand of referring the issue of 2G Spectrum Scam to the Public Accounts Committee (PAC). The committee is being led by senior BJP leader Murli Manohar Joshi. The Congress leadership present in the meeting was of the view that since the veteran BJP leader was not on very good terms with his present party leadership, he could be more amenable to governments viewpoint on the issue. Sources in the BJP have also confirmed to 2GScam.in that some senior party leaders like Rajnath Singh and Arun Jaitley do not want Joshi (as PAC head) to investigate the 2G scam. According to them he has an independent viewpoint and things might get out of their control. It is also feared that if that happens they might not be able to use the 2G Spectrum Scam issue for political gains in the time to come. BJPs strategists believe that if a JPC probe is ordered then they can use the issue for a longer period of time (Assembly Polls in certain states next year and General Elections in 2014). Also, the members of the JPC can keep on widening the scope of the inquiry, and can even summon the Prime Minister to appear before it. At an all-party meeting, Finance Minister Pranab Mukherjee even proposed a multihttp://www.2gscam.in/post/9552068625/2g-spectrum-scam-why-is-bjp-demanding-a-jpc Page 1 of 2

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disciplinary probe along with the PAC. But the BJP rejected it on the ground that only JPC can investigate the scam of such a huge magnitude. While the government and the Opposition parties waste precious parliamentary time over what type of inquiry should be setup, no attention is being paid to immediate measures to be taken to undo the wrongdoings committed. The investigations can go into the details of the scam and the players involved. But it is equally important to take immediate action against companies that benefited from arbitrary spectrum allocation at lower prices. blog comments powered by Disqus 9 months ago BJPJPC on 2G ScamUPA GovernmentTelecom ScamMurli Manohar JoshiPublic Accounts Committe2G Spectrum2G Spectrum Scam2G ScamA Raja

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Ratan Tata should have ignored Chandrasekhars letter

text BY ARUN AGRAWAL Mr Chandrasekhar should have been the last person in the country to join issues with Mr Ratan Tata on the telecom scam, which has been going on since 1999, as he was a major part of the scam. The fact that he chose to do so, shows the rapid degeneration that takes place when an unsuccessful industrialist tries to become a successful politician, courtesy money earned through the telecom scam. Mr Chandrasekhars journey from an employee of a tech company to a rival of the Tatas in the telecom sector, from President of COAI to having become an independent Member of Parliament with the support of BJP, and to using (misusing) his status as MP to criticize Ratan Tata is indeed a long journey. The most important disclosure he should have made is that he profited by more than Rs 1200 crores by trading in the BPL mobile license for Bombay, Maharashtra, Goa and Tamil Nadu and selling it to Essar Hutch after the companies became sick due to his mismanagement. He should have also disclosed his falling out with his father-in-law TPG Nambiar (along with other shareholders and creditors), the owner of BPL, over the sale of stake in the cellular holding company BPL Communication to the point that Nambiar dragged him to the Company Law Board. He should have also disclosed the real amount that he spent for becoming a Rajya Sabha MP with BJP support as everyone knows that he bought his seat as an industrialist, more so because he was criticizing Ratan Tata as an MP and he had purchased political power from the proceeds of the gain made by trading his mobile license! Any investigation/inquiry should include making public the amount BPL gained by selling their license/spectrum and the amount written off by the public sector banks in the credit defaults by the BPL group and the same should be recovered. I hope Mr Chandrasekhar who has chosen to wear the patriotic cap will not have any objection. Mr Chandrasekhars arrogance has been exposed by Mr Ratan Tata enclosing the letter that was sent to him by Chandrasekhar for his signature. It was a letter that was
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addressed to the Prime Minister and was written to serve the interest of the GSM mobile operators. For Chandrasekhar to even imagine that any industrialist on the opposite side (having a limited mobility of WLL) would sign the letter betrays the mindset of a person who thinks he is too clever and that others are foolish enough not to see through his game. It is to the eternal credit of Mr Ratan Tata that he was the only major player in the telecom sector who was serious in advocating the auctioning of the spectrum. The rest of them made fun of him because they knew that they could manipulate the system by bribing the political establishment and get the spectrum for a much lesser price.. Was it the games played by operators like Chandrasekhar that prompted Mr Ratan Tata to appoint a lobbyist like Nira Radia who could charm her way to the powers that be and ensure that Tatas too got a portion of the largesse that was being distributed to all and sundry? That she used her position of proximity with the Minister to lobby for others and cut in other shady deals to a point of being a co conspirator is another matter. It is for some strange reason that Mr Chandrasekhar does not find anything wrong in Anil Ambanis RCom being given a GSM license on 18/10/2007 when there was no notification for applying for a GSM license under dual technology but finds fault with the Tatas application of 22/10/07 for GSM after the notification for dual technology was made on 19/10/2007. The notification was made to regularize the allotment made to RCom in which a bribe was paid through transfer of Swan Telecom by Anil Ambani to benami holders on the very same day (18/10/2007) that RCom got a license. Tatas, under the existing rules could not apply for a fresh license under the firstcome-first-serve window of 24/07 to 1/10/07 because they already had a license but whether they did so through Unitech is a matter to be probed. Tatas benefited because they were in the same CDMA boat as the Ambani, but did not benefit entirely in the allotment of spectrum. Tatas benefit is quantified in the deal with DOCOMO, who acquired a stake (Rs 13,000 crore for 26% stake), but the valuation included their earlier license and rollout along with the fresh license. In fact the premium represents the sins of all the
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bribing and wheeling dealing that has been going on in the telecom sector combined with the subscriber base and infrastructure required for a successful roll-out. Mr Tata should have ignored the letter coming as it did from a person who lacks the basic credentials to write the letter and conveniently forgets to make disclosures about himself. However, it is also a fact that Mr Tata is not a victim but a beneficiary of the great telecom scam. After all one cannot be wearing a three piece suit in a nudist colony! (Arun Agrawal is the author of the book Reliance: The Real Natwar) Read More: Read Rajeev Chandrasekhars open letter to Ratan Tata Read Ratan Tatas open letter to Rajeev Chandrasekhar blog comments powered by Disqus 8 months ago Rajeev ChandrasekharRatan Tata2G Spectrum2G Scam2G Spectrum ScamTata TeleservicesNiira RadiaDoCoMoniNira RadiaBPL Mobile

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Telecom Scam: Is Swan Telecom being let off?

text Is the UPA Government serious about investigating the 2G Spectrum Scandal? While the investigating agencies are pursuing all aspects of the scam, the government seems to be busy giving clean chit to companies already under the cloud of suspicion. 2GScam.in, in a post on November 2, 2009, reported about the complaint sent to the Central Vigilance Commissioner (CVC) with regard to Swan Telecom. The most important issue that the original complaint raised was who owned Swan Telecom and who actually benefited from the sale of those licenses to other companies at a higher market price later. Now, another complaint has been sent to the CVC with regard to Swan Telecom. According to the letter (produced below), the Ministry of Corporate Affairs (MoCA) and its senior officers are involved in a criminal conspiracy for cover up in the 2G scam by giving a clean chit to Swan Telecom. For a complete understanding of the issue and the alleged irregularities, read below and also the communication between the Department of Telecom and MoCA regarding Swan Telecom. Read the complaint submitted to the Central Vigilance Commissioner on December 30, 2010: To Chief Vigilance Commissioner New Delhi Complaint against the Minister of Corporate Affairs and other officials for cover up in the 2G scam. Kindly refer to my complaint on the 2G scam dated 13/5/09 and registered as complaint no 416/09/2. The complaint was enclosed as an annexure in the writ petition filed before the Honble Supreme Court and was read out in Court by the learned Counsel. This complaint relates to reference made by DOT to Ministry of Corporate Affairs regarding the ownership of Swan Telecom. By giving Swan Telecom a clean chit , MoCA and its senior officers are involved in a criminal conspiracy to cover up and
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this complaint is directed against them. The clean chit given to Swan Telecom vide MoCA letter in file no 3/92/2010/CL-II dated 24/12/10 is enclosed.. As the enclosed letter has been issued with the approval of the Corporate Affairs Minister (last line of the letter), the Minister too is involved. The clean chit has been given by certifying that Reliance Communication through its subsidiary Reliance Telecom never held more than 10% (9.9%) of equity shareholding of Swan Telecom. It has also been certified that Reliance Communication or its subsidiary Reliance Telecom did not hold any shares in Tiger Trustee, the company which held 90% of the shares of Swan Telecom. It has been stated that preference shares is not capital but more in the nature of debt and cannot be added to equity shares for the purpose of computing the percentage shareholding. The certificate of clean chit given to Reliance Communication and the ADAG group is assailed on the following grounds and is to be seen as an act of cover up and corruption: . Is it not true that the promoters of Reliance Communications held more than 66% of the shares of the company throughout the period of the scam that is from 2/3/07 to 16/12/07? Kindly refer to the filings on the shareholding pattern of Reliance Communication with the National Stock Exchange. Is not true that there are 11 individuals and 23 corporate bodies who have been identified as the promoter group in the filings made with the NSE? Is it not true that the UAS guideline provided No single company/ legal person either directly or through associates shall have substantial equity holding in more than one licensee company in the same service areaThe ceiling for substantial equity was notified at 10%.. Does the guideline mean that only the company cannot hold more than 10% in another company or that the promoters of the company too cannot hold more than 10% of the shares in another company with a license. It definitely means the latter because if it was the former then Tatas, Mittals and the Ambanis , not to forget the Essars (who incidentally are in a similar Swan Telecom like situation) would float companies by the dozens and corner as many licenses as possible. Can the ROC and the Minister give a certificate that no money has been invested dihttp://www.2gscam.in/post/9569161048/telecom-scam-is-swan-telecom-being-let-off Page 2 of 6

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rectly or indirectly by the eleven individuals and the various shareholders of the 23 companies who promoted Reliance Communications? Can they give a certificate that Anil Ambani as the head of the ADAG group did not control Tiger Trustee? Is it not true that more than 90% ( 90.09% to be precise ) of the shares of Swan Telecom were held by Tiger Trustee Pvt Ltd). Refer Auditors report for 31/3/07 and 313/08.. Is it not true that Swan Telecom was registered as Swan Capital Pvt Ltd, was incorporated on 13/7/2006. One share was allotted to Himansu Agarwal and 4999 shares to Powersurfer Interactive (India) Private limited and that the address of both the shareholders was Reliance Energy Centre, Santa Cruz (East), Mumbai, 400055. In addition another 5,000 shares was subscribed by Reliance Energy Management Services Private Limited with the same address. The persons signing the Memorandum and Articles were all having the same address of Reliance Energy Centre, Santa Cruz (East), Mumbai, 400055. Can the Minister certify that the directors of Swan Telecom/Tiger Trustee who were also directors in a large number of ADAG group of companies (over thirty companies) and that none of these companies in which directors are common hold shares as promoters in Reliance Communication? If all the statements made above in the form of questions are true then the clean chit given to Swan Telecom is an extension of the ongoing corruption in the 2G scam. The decision of the MoCA that the ADAG group had nothing to do with Swan Telecom group is further assailed on the following grounds: If the incorporation of Swan Telecom (registered as Swan Capital) with the registered office address, the subscribers of the share capital and the directors of the company was not sufficient evidence of the company being a 100% ADAG group company, then one wonders what would be evidence? Swan Telecom was a company, incorporated owned and controlled by the ADAG group. It was among the various shell companies that the Reliance group keeps on forming
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for multifarious activities depending on what is the requirement of the day. Most of them are investment companies in which the ownership is to be layered so that the identity of the true owner has to be concealed as India is the ultimate destination of hot money and crony capitalism. It is the vehicle through which the political masters are bribed and become part owners of the business they help to benefit through their illegal decision making process. It is because of this reason alone that these shell companies are formed and kept ready in time of need. They can also be the vehicle of major frauds and bribes . In fact transfer of Swan Telecom was the bribe paid for the license given to Reliance Communications on 18/10/07 and it was transferred to the benami of the politicians on the very same day. This is how it happened: Swan Capital was the original name at the time of incorporation and its name was changed to Swan Telecom on 15/2/07 since the company was needed for the telecom sector. The company needed a capital on paper of over Rs 1100 crores to comply with minimum capital requirement norms for applying for license in the thirteen circles.. The GSM license for which application was made by Swan Telecom was not pan India but for only those circles in which Reliance Communication did not have GSM license. The application was made for thirteen circles as Reliance Communication had GSM license for Bihar, Himachal Pradesh, Kolkata, Madhya Pradesh, Orissa, West Bengal. The fact that licenses for only thirteen circles were applied for and that only those circles in which Reliance had GSM license was excluded shows that the ADAG group was the owner and in control of Swan Telecom through its proxy directors. Second and more important, the company needed to have capital and reserves of over 1100 crores in the balance sheet to apply for the license for 13 circles, according to the fee that was paid in 2001 in the bidding process for the fourth operator. Whether the ADAG group had clairvoyant powers of anticipating the future telecom policy of A Raja of allotting licenses on 2001 prices on a first come first serve basis or were a conspirator in dictating the policy can be decided by the quantum of investment made in Swan Telecom and the circles for which the application made seven
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months before the policy was announced . The greater dilemma was to get 1100 crores in Swan Telecom and also not apparently violate the licensing norms of an existing telecom company not owning more than 10% of the shares in another telecom company. The money was there in the public listed company Reliance Communication from where it had to be re routed. It was not there in any of the privately held ADAG companies. The old model of using money from the public listed company and retaining control off the shares by privately held company was used. While 90% of the money was invested by a subsidiary of Reliance Communication, a public listed company (1002 crores), a little less than 10% of the shares of Swan Telecom were allotted to the ADAG group subsidiary of Reliance Communication. This was done by Reliance Communication subscribing to preference shares at 8% interest at an unimaginable premium of 99900%. for an amount of Rs 992 crores. The rest of the shares 90% were allotted to a company registered on 20/6/06 as Tiger Traded Private Limited which was rechristened as Tiger Trustee with the approval of the Registrar of Companies. (Will be referred to as Tiger Trustee to avoid confusion) It is this company which in effect was the owner of Swan Telecom, which has been ignored in the investigation by the MoCA deliberately. In fact it is this company which is at the root of the fraud and bribe giving. It is therefore not surprising that the Minister has chosen to ignore the holding company of Swan Telecom - Tiger Trustee while giving a clean chit. The omission is deliberate, malafide and smacks of a quid pro quo. Tiger Trustee registered address was Reliance Energy Centre, 3rd Floor, Santa Cruz (East), Mumbai, 400055. It had two directors, Ashok Karyekar and Paresh Rathod. The residential address of both the directors was Reliance Energy Quarters, Chembur. While Ashish Karyekar held directorship in 13 companies of the ADAG group whose name began with Reliance, Parash Rathod was a director in 12 ADAG companies. The paid up capital of Tiger Trustee was one lac. The capital remained at one lac, till 17/10/07, that is well beyond the unrevised cut off date of 1/10/07 for applying for fresh telecom (UAV) license. Tiger Trustee owned 90% of the share capital of Swan
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Capital, while contributing only 10% of the funds and the balance was contributed by the public listed ADAG company Reliance Communication subsidiary. Given the address of the holding company Tiger Trustee, the directors and their addresses, the paid up capital of mere one lac, and fact that over 1000 crores of money was siphoned off from the public listed company (inspite of the so called independent directors) into Swan Telecom to make it compliant with capital norms; can there be any doubt that Swan Telecom was anything but a Anil Ambani Company? If Anil Ambani was not the owner of Tiger Trustee then it has to be either the Congress party (or its nominee) or DMK or A Raja or some other leader of a major political party who was the actual owners of Tiger Trustee which in turn owned Swan Telecom. This is because Anil Ambani will invest 1000 crores either to benefit himself or the politicians involved as crony capitalist. None of the people involved in the cover up have answered the question as to who was the owner of Tiger Trustee from 2/3/07, the date on which the application was filed to 18/10/07, the date on which pan-India license was given to Reliance Communication and on which date the company Tiger Trustee was transferred to Balwa and Goenka for a paltry investment of 4.99 crores? That was the bribe for the license given to Reliance Communication on 18/10/07, one day before the policy was announced. A K Agrawal Bangalore 30/12/10 blog comments powered by Disqus 8 months ago Anil AmbaniReliance Communications2G spectrum scam2G scam2G spectrumSWAN TELECOMTiger Trusteecentral vigilance commissionMinistry of Corporate AffairsSalman Khurshid

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2G Scam and Sibals strange arguments

text BY ARUN AGRAWAL Last week, one was dumbfounded when Union Telecom Minister Kapil Sibal tried to insult the intelligence of the entire nation while stating that the 2G scam did not cause any loss to the nation. Though his arguments seemed convincing, they were heavily flawed. The one to one interview with TV anchor/talk show host Rajdeep Sardesai and Karan Thapar did not help matters. Neither of them did their homework, did not read or understand the issues raised by the CAG report. In short, they had not put in the work required to take on the minister who was on top of his brief. That further emboldened the minister and it was only after the Chairman of the Public Accounts Committee Murli Manohar Joshi and the CAG Vinod Rai intervened that the ministers aggression abated. How honest was Sibal in his arguments can be better appreciated if one goes back to what has been recorded by the Honble Judges of the Delhi High Court in Home Communication Ltd. And Anr. vs Union Of India, argued by him. The issue in that case too was the first come first serve system of allotment of time slot on satellite channels. Sibal was representing Hindustan Times in that case. The First-Come-FirstServe (FCFS) policy was struck down by the Delhi High Court, a fact conveniently forgotten by both Sibal and A Raja, be it for different reasons. Here are the excerpts of what Sibals arguments as recorded in the judgment: Kapil Sibal said that the principle of first come first served was applicable only in such situations where the recipient of the distribution of the largess was entitled to refuse to deal in the said commodity, and that it applied only to such cases involving the government and the vendee where the vendee had the absolute right in discretion to deal with the commodity in the manner it liked and the public was entitled not to purchase the said commodity. He said such a principle was wholly inapplicable to the concept of public broadcasting where the general public had no right not to view the programme. He said if it was an import license the question would have been different and the only affected party would be the competitor, but here it is the general public. Sibal said that the present scheme was unworkable, and perhaps, auction could have been a better method. He said between FCFS and Random Number Generation the latter would be still better as everybody would have a chance
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there... FCFS could work only if the demands were less and slots were more which was not the case here, so Sibal put in. He said that the FCFS method as envisaged will result in black marketing of time slots by unscrupulous licensees which will be at the cost of the public revenue as well as sufferings of the viewers.The policy as it stands promotes trafficking in licenses and fails to address itself to the consequences and the policy to be adopted in the event a particular programme fails. Everything that Sibal said then is applicable to the 2G scam now. The difference was that in the 2G scam licenses were given on the FCFS, and that black marketing did take place at the cost of public revenue. All that the CAG did was compute the loss in terms of the auction price of the 3G spectrum and the rate at which Swan Telecom and Unitech black-marketed the license. Sibal, to be fair, may take the defence that in that case he was arguing for a hefty fee (amount not known) by representing Hindustan Times and was merely being loyal to his client. Which then begs the question that how does one know that he is not arguing now to make a bigger gain? Is that the reason then for his allowing all the license holders to pay a minuscule fine for not complying with the roll out norms instead of forfeiting the license and re auctioning them? What is the difference in amount between forfeiting the license and collecting the fine? What would five percent of that difference be? Kapil Sibal would like us to believe that the exchequer benefited by Rs 110 crores because he believes that spectrum is for free. However, if the lowest of the black marketing figure is used to calculate the loss then the exchequer is poorer by Rs 50,000 crores, 5 percent of that is Rs 2500 crores. Could that be the amount that Sibal and his party made in the cover up? That is a lot better than arguing a case for Hindustan Times! (PS: It was the license that was being sold and the license fee that was being paid for
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included the cost of the spectrum. It was the license that had to be auctioned. The CAG has dealt at length on the issue of separating license from the spectrum.) (Arun Agrawal is the author of the book Reliance: The Real Natwar) blog comments powered by Disqus 7 months ago Kapil SibalCAG ReportCAGCAG Report on 2G Scam2G spectrum scam2G scam2G spectrum

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Questions over Batchas death

text Sadiq Batcha, a close aide of former Telecom Minister A Raja, was found dead in his Chennai home on Wednesday. Batcha, who was the Managing Director of real estate firm Green House Promoters, was interrogated several times by the CBI in connection with the 2G scam investigations. His home and offices were also raided by the CBI. Batchas suicide has surprised many and questions are also being raised at his sudden death. According to Rediff.com, Ever since Rajas arrest, there was immense pressure on Batcha, who, according to the Central Bureau of Investigation, was the key aide of the former minister. The promoter of a real estate company named Greenhouse Developers, Batcha was scheduled to leave for New Delhi on Wednesday. The investigation by the Central Bureau of investigation alleges that Greenhouse was the front company belonging to Raja, and all the money earned through the 2G spectrum scam was parked in various places through this company. The investigations have also shown that Batcha handled all the money which came into Rajas hand. It was also found that he had invested money in a lot of real estate projects in Tamil Nadu. Today there is no reason for the police to believe that it could have been a case of murder as well. Batcha had with him too much information and he was the man who would have given CBI the exact map of the 2G money trail. Sources say that even if it was a case of suicide, it could have been due to the immense pressure since the CBI was also looking into the underworld and the hawala link to the money trail in the multi-crore 2G scam. It is said that Batcha was the link between the 2G money and also the underworld and the hawala operators. The CBI, which has raided Batchas house on two occasions, was all set to question him in
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connection with the money trail. Moreover, the CBI had also decided to arrest Batcha and question him in custody. This was something that none of those involved in the money trail could have afforded, since it would have blown the lid of many persons connected with the scam. Sources say that at any cost the persons involved wanted to prevent any questioning of Batcha and could have stepped up the pressure on him. The police would verify his call records to see if there were any death threats which ultimately led to the suicide of Batcha. The CBI during its probe had found that Raja had many fronts through which the 2G money was parked. However, all aspects of the probe showed that it was the firm managed by Batcha which had played the most crucial role. Sources say that Batcha was just a front man and did not take any decision on his own. He was brought into the picture due to his contacts that he had built up when he was a realtor. He is alleged to have contacts with hawala operators and also the underworld through which he had managed to park funds in various places. The CBI questioning of Batcha would have led them to the route of the money trail. In addition to this, they were also trying to find out if Batcha had parked any money for the Dravida Munnetra Kazhagam. Investigators say his death is a big blow to the investigation since it was extremely important that this man was questioned since he knew the exact details regarding the money trail as he had played a huge part in it. Meanwhile, the Tamil Nadu Government has said that it will hand over the investigation of the case to the CBI. (The text in Italics has been taken from Rediff.com as mentioned in the post. You can read the same post here) Also Read: Rajas close aide Batchas suicide note found Just who was Sadiq Batcha? 2G scam: The A Raja-Sadiq Batcha link
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Sleuths to leave for Dubai to track Batchas hawala trail blog comments powered by Disqus 5 months ago Sadiq Batcha2G spectrum scam2G Spectrum2G scamA RajaMoney launderingGreen House PromotersHawalaRediff

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Excerpts from PAC Report 1

text The report of the Parliaments Public Accounts Committee (PAC), looking into the 2G Spectrum Scam, has created a controversy with majority of the committee members (Congress and allies) not in favor of tabling the report. These members allege they were not consulted while the report was made. The Congress members in the committee do not want the PAC to look into the Spectrum Scam as they feel that there is already a Joint Parliamentary Committee (JPC) to look into the matter. Our politicians have never learnt or followed the principles of bi-partisanship so to expect them to behave maturely and think in the interest of the Parliament for a while instead of toeing the narrow party lines is too much to ask. As the clouds of uncertainty looms over PACs 2G report, which was prepared after the depositions of key players (CBI, Bureaucrats, CAG, PMO officials, Industrialists, Lobbyists among others), 2GScam.inbrings you excerpts from the report. According to the report, The committees detailed examination of this subject based on oral depositions by several witnesses and scores of written documents obtained from various sources has revealed gross violation of the established norms, rules and procedures, dereliction of duties on the part of Ministries/Departments concerned, scant regard, bordering on contempt, for considered suggestions/opinions of the people/organization that mattered etc. The PAC report has mentioned a list of reasons that lead to the scam. Each one is listed as a new post. IGNORING THE ADVICE OF THE MINISTRY OF LAW & JUSTICE The Committee note that consequent upon the recommendations of TRAI in August, 2007 for putting `no cap on the number of players in a circle/service area, 575 applications were received for UAS licences as of the cut-off date i.e. 1st October, 2007. In order to handle such a heavy rush of applications in a fair and equitable manner which would be legally tenable, the Member(Technology), DoT wrote a letter to the Secretary, Department of Legal Affairs seeking legal opinion from the Attorney General/Solicitor General and suggesting four alternatives. The Law Secretary, opining
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that the issues were too broad and had to be refined further, put up a note to the Minister of Law & Justice for his consideration. The Minister, agreeing with the Law Secretary, suggested for the constitution of an Empowered Group of Ministers to consider the whole issue. In response, the Minister of Communication & Information Technology in his letter to the Prime Minister stated that the suggestion of the Law Ministry was totally out of context. The Committee deplore the intemperate and indecorous manner in which the considered advice of the Ministry of Law & Justice to refer to the Empowered Group of Minister such an important matter like following a fair and transparent procedure for handling the large number of application for grant of UASL was termed as out of `context by the Minister of Communication & Information Technology. The DoT could not furnish any cogent explanation for setting aside the advice of Law Minister nor could they furnish the file containing the said draft letter. It is really surprising and shocking that the legal opinion which was sought by the Department on its own volition was rejected by its Minister. Needless to say, by doing so the benefits of the discussion on important telecom matters in an inter-ministerial forum were deliberately stymied. The Committee are of the considered opinion that seeking legal opinion to handle the large number of applications in a fair, transparent and equitable manner was a sound and rational decision but the manner in which the considered advice of the Law Minister, on being found unpalatable, was turned down, only shows the malafide intentions of the then MOC&IT. The Committee are shocked to note that contrary to the advice of Ministry of Law & Justice, the Ministry of Communication & Information Technology had a direct reference made to the Solicitor General on 7.1.2008 seeking his opinion on the Press Release which was later issued on 10.01.2008 to which the SG opined that the proposed course for issue of LOIs `is fair and reasonable and `make for transparency. What is intriguing is that the SG gave advice on a matter for which the Ministry of Law & Justice had advised for reference to EGOM. The Law Secretary, while deposing before the Committee has categorically stated that seeking direct opinion of the SG bypassing the Ministry of Law & Justice is not in line with the rules and procedures prescribed in this regard. The Attorney General himself is of the opinion that the Minister, should not make references to any Law Officer directly. But it is quite intriguing that the Ld. Attorney General, when he was the Solicitor General, has had himself entertained a direct reference made by the Minister of Communications & IT. The Committee, therefore, recommend that a serious view must be taken in the matter. The
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Committee also recommend that the advice given by the Law Ministry particularly on important matters having wide ranging implications must be taken with the seriousness that it deserves and where rejected, reasons must be furnished to the Law Ministry under intimation to the Cabinet Secretariat. Further, Ministry of Law & Justice need to issue appropriate instructions and procedure so that all cases seeking advice/opinion of Attorney General/Solicitor General are routed through the administrative Ministry only. A serious view must be taken against any deviation from the established procedure and stringent action must be taken against officials who violate the prescribed procedure. The Committee note that in his letter dated 26th December, 2007, the Minister of Communications & IT had apprised the Prime Minister that his discussion with the External Affairs Minister and the Solicitor General had enlightened him to take a preemptive and proactive decision on the issue of UAS licences/2G Spectrum. But a perusal of the then External Affairs Ministers note to the Prime Minister reveals that he has underlined the responsibility of the Government to frame, revise and change the policy in a transparent manner and then follow it in letter and spirit. He has also categorically remarked that while keeping on issuing new licences, the criteria for grant of the licences may be strengthened and put in public domain at the earliest. Thus, it is evident that he did not give any wrong advice to the M/o Communications & IT who in turn distorted the facts while writing to the Prime Minister. Similarly, the Attorney General has clarified in a written note that he has never verbally or in writing concurred with any proposed course as claimed by Shri A. Raja in his letter dated 28th December, 2007. Thus, neither the then External Affairs Minister nor the then Solicitor General had supported the then M/o Communications & ITs claim of being enlightened by them. The PMOs reply that no suggestion of the Law Minister to set up an EGOM was received by them does not convince the Committee in view of the fact that the Communication Minister himself apprised the Prime Minister of the Law Ministers view alongwith his own view thereon. It implies that the PMO was very much aware of the Law Ministers suggestions, but the counterview of the Communication Minister got overriding preference to the Law Ministers views for some unknown reasons and thus no effort was made by the PMO to initiate the process of the constitution of the EGOM. The PMO certainly either failed to see the forebodings or was rendered a mute spectator. blog comments powered by Disqus
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2 months ago PAC Report on 2G ScamPublic Accounts Committe2G spectrum scam2G scamKapil SibalMurli Manohar Joshi

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Excerpts from PAC Report 2

text The report of the Parliaments Public Accounts Committee (PAC), looking into the 2G Spectrum Scam, has created a controversy with majority of the committee members (Congress and allies) not in favor of tabling the report. As the clouds of uncertainty looms over PACs 2G report, which was prepared after the depositions of key players,2GScam.in brings you excerpts from the report. The PAC report has mentioned a list of things that lead to the scam. Each one is listed as a new post. This is the second post which states how the Telecom Ministry ignored the Telecom Commission. NOT CONSULTING THE TELECOM COMMISSION The Telecom Commission was set up by the Government in 1989 with the objective of formulation of the policies of the DoT for approval of the Government as well as to oversee the implementation of the policies and preparation of annual budget of the DoT. Unfortunately, an artificial and convenient division has been created by inclusion of full-time and part-time members of the Commission. The permanent members of the Commission including the Chairman are employees of the DoT and the presence of three permanent members constitutes the quorum. The other members, parttime but permanent Government servants, are Finance Secretary, Industry Secretary, Secretary IT and Secretary, Planning Commission. The Committee note that as per the Rules of Business of the Telecom Commission matters of policy relating to telecommunications and proposals for acceptance of any rules and procedures which involve significant deviations from normal rules and procedures of the Government are to be brought before the Commission. But the Committee are constrained to find that the TRAI recommendations of 2007, which were very crucial from the perspective of the management of the Telecom Sector and Spectrum Management, were never placed before the Telecom Commission. The DoTs reply that it was discussed in the internal Telecom Commission on 10th October, 2007 is unacceptable in view of their own admission that the Resolution, Rules of Business and Rules for the Transaction of Business of the Telecom Commission do not contain any reference to Internal, External or Full Telecom Commission; only the term Telecom Commission finds a place. Thus, it is established that the prevalent practice has been developed in
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the DoT as a camouflage to take very convenient decisions through the permanent internal members of the DoT and avoid uncomfortable decisions in the entire Telecom Commission where the part-time but independent members, particularly the Finance Secretary, would be raising objections. This fact has been corroborated by one of the former Secretaries of the Department of Telecommunications. The Committee strongly disapprove such a dubious practice and impress upon them to henceforth discard distinguishing between the full time and part-time members or for that matter between internal or full Telecom Commission as the Commission is one entity. The Telecom Commission was set up for fair and independent working of the DoT but the manner in which the Telecom Commission is operated, it has been reduced to a mere charade rendering its very integrity questionable. The Committee, therefore, recommend suitable amendments in the Business Rules so that it is made mandatory to refer all matters relating to policy and change in policy or procedure to the Telecom Commission by doing away with the procedure of internal or full commission for their approval. Further, all such policy or procedural changes once approved by the Commission must be notified after due approval of the Cabinet. The Committee observe that one of the convenient methods adopted by the Department to keep the part-time members at bay is to put in a clause in the Business Rules to consolidate the quorum with the presence of three full time members only. The Committee exhort the Government to revisit the Transaction of the Business Rules of the Commission with a view to revising the quorum rule making the presence of the Finance Secretary, or his authorized representative not below the rank of Joint Secretary in the Department of Economic Affairs, as essential condition for constituting the quorum. blog comments powered by Disqus 2 months ago PAC Report on 2G ScamMurli Manohar Joshia raja2G spectrum scam2G scam2G spectrumdepartment of telecom

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PM speaks on 2G Scam
text Prime Minister Manmohan Singh finally broke his silence and met with editors of five newspapers. While discussing a range of issues and answering questions the PM also spoke about various corruption scandals (including 2G Scam), admitting that he may have been soft. Question: Do you think you should have dealt with your coalition partners more firmly in your earlier term? Answer: I really dont know which is the golden mean? I dont know if some of these things could have been avoided. Because some of these things which have happened, they have happened without our getting the full picture. Take the case of 2G auction. I had myself written to Raja, that we should consider auction. He wrote back saying this matter was considered by TRAI. TRAI came to the conclusion which was endorsed by Telecom Commission this is on record and it is a public property you also have access to it. He said to me TRAI is against auction. TRAI is also against other verification which would help the competition between the new and the old. Quite frankly, I felt TRAI exists to advise the government, it is an expert body. And therefore, I left it at that. On the same matter, three letters that he wrote to me, he assured me that utmost transparency, fairness and objectivity will be observed in anything that he has done or will do. When a cabinet colleague makes that sort of an assurance, I cannot sit in judgement. After that someone approached the CVC. The CVC then passed it on to the CBI. The CBI began investigating. They raided the offices of the ministry. Question: One of the biggest assets you had was your integrity and honesty. But in the second term, while your personal integrity remains above board, there is an impression that you allowed these things to happen. Answer: If a Cabinet colleague tells me, that in all matters of his ministry, he will scrupulously work by the norms of ethics, fairness and transparency. How can I conduct a post-mortem? I am not an expert in telecom matters. As Prime Minister, it is not that I am very knowledgeable about these matters. Or that I can spend so much of
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my time, to look after each and every ministry. Ministers administer their departments, and if they dont apply any policy change, they are free to implement the policy to the best of their ability. One observation that my private secretary recorded, that the Prime Minister says there must be transparency the minister should have said it was his responsibility rather than saying that the Prime Minister has also endorsed it. blog comments powered by Disqus 2 months ago Manmohan Singh2G scam2G spectrum scama rajacentral vigilance commissionCBI Probe

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Excerpts from PAC Report 3

text The report of the Parliaments Public Accounts Committee (PAC), looking into the 2G Spectrum Scam, has created a controversy with majority of the committee members (Congress and allies) not in favor of tabling the report. As the clouds of uncertainty looms over PACs 2G report, which was prepared after the depositions of key players, 2GScam.in brings you excerpts from the report. The PAC report has mentioned a list of things that lead to the scam. Each one is listed as a new post.This is the third post which states how the Telecom Ministry arbitrarily changed the cut-off dates for accepting applications for telecom licenses without consulting anybody. ARBITRARY CHANGES IN THE CUT-OFF DATE The Committee note that in August, 2007 TRAI had recommended that there be no cap on the number of licences in any service area and the recommendation was accepted by the Government in October, 2007. But, circumventing the TRAI recommendation and bypassing its own decision of the acceptance of the recommendation, the DoT capriciously for no valid reasons, put an artificial cap on the number of licences to be issued through its Press Release dated 24th September, 2007. The Department reasoned that at the time of reference to TRAI in April, 2007, only 53 applications were pending but after TRAIs recommendation in August, 2007 there was a sudden spurt in the number of applications and hence the Department decided to stop receiving further applications keeping in view the likely availability of Spectrum. The Departments reasoning is unacceptable because TRAIs August, 2007 recommendation was accepted by the DoT in October, 2007 by which time there must have been some indications of the number of applications that would be coming. Moreover, the Authority was not consulted on the matter as its recommendations were not considered in the entirely nor the issue was placed before the Telecom Commission and a cut-off date was announced. Astonishingly, nobody in the DoT even thought of it as is corroborated from the fact that no material on record was available with the Department to show any initiative in this regard. What is worse is that the cut-off date of 1st October, 2007 was advanced to 25th September, 2007 through a Press Release dated 10th January, 2008 in a dubious decision taken by the Minister on 2nd November, 2007.
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Such a decision was taken without the approval of the full Telecom Commission which was scheduled to meet on 9.1.2008 but the meeting was deliberately postponed to 15.1.2008 anticipating objections. What is more important is that it was so done despite the advice of the Prime Minister contained in his letter dated 2.11.2007 emphasizing allocation of spectrum and revision of entry fee in a fair and transparent manner. The CBI written replies show that the office of Telecom Minister was personally monitoring the receipt of applications and only after ascertaining the receipt of certain companies by 24.09.2007, the cut-off date was advanced arbitrarily. The High Court of Delhi in the S.Tel case had ruled that there cannot be a change in the rule after the game has begun and that the DoT cannot be allowed to arbitrarily change the cut-off date and that too without any justifiable reasons. On this question whether this cut-off date was announced on the basis of availability of spectrum, the former Secretary who has since been charge sheeted, admitted that there was no synchronization and no scientific analysis nor did he see any file regarding availability of spectrum. Upon the scrutiny of written and oral evidence and the perusal of the findings of the OMC, the CBI and the judgment of the High Court of Delhi and the refusal of the Supreme Court on appeal by the DoT to interfere with the orders of the High Court holding the advancement of the cut-off date as arbitrary and unjustifiable, the Committee refrain from making any further comment. Now that the CBI is investigating the case under the Supreme Courts monitoring, the Committee believe that the investigating agency will take the case to its logical conclusion. In the meantime, the Committee urge upon the Department to desist itself from any gross irregularity in any future allotment of licence/spectrum in larger interest. The Committee are perturbed to note the audacious reply of the Department that neither the cut-off date of 1.10.2007 was pre-poned nor were the applications for grant of UAS licences which were received after 25.09.2007 rejected. The fact remains that 343 applications, received between 26.09.2007 and 1.10.2007, are still pending with the Department and applications received only upto 25.09.2007 were considered for grant of UAS licence. The Department therefore owe an explanation for their misleading statement. From the written reply furnished to the Committee, it is found that the then MOC&IT on 2nd November, 2007 approved the advancement of the cut-off date to 25th September, 2007 on the ground of availability of only 15MHz of Spectrum but while replying to the Prime Minister on the same day, he claimed that there was 60- 65MHz Spectrum still available for the 2G services. When the Department was asked to explain the position, they informed that there was a typographical error in the material
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furnished to Committee. The Committee find the plea of typographical error selfcontradictory in view of the availability of Spectrum as indicated in the letter dated 02.11.2007 of Ministry of Communications & Information Technology to the Prime Minister and therefore untenable. The DoT therefore, must fix responsibility for such contradictory information furnished to the Committee. Another glaring discrepancy has been noticed in the Departments noting vis-a-vis the Communication Ministers letter to the Prime Minister. The Committee find that file noting of the Department did not anywhere mention the availability of the Spectrum in the 900 MHz band whereas the Ministers letter to the Prime Minister categorically indicated the availability of 60 to 65 MHz of 900 band spectrum. Clarifying the position, the Department submitted that it was expected that Defence would release 60 to 65 MHz of Spectrum in the 900 band. In the context of S. Tels case, the Department have informed the Committee that the companys conditional offer did not merit any consideration since it was in respect of Spectrum in the 900 MHz band which was not available. Thus, it is evident that when the Minister wrote to the Prime Minister, Spectrum in 900 MHz band was not available and just in anticipation of vacation of Spectrum by Defence, he had the temerity to mislead the Prime Minister. The Committee castigate the dubious role played by the officers concerned in the Department and the Minister who misled the Prime Minister on such important matters of allocation of the scare natural resource. The Committee, therefore, recommend stringent punitive action against all those responsible for furnishing wrong information to Parliament, suppressing facts and deliberately misleading the Prime Minister. The Committee also be apprised of the measures since instituted to prevent such recurrences. blog comments powered by Disqus 1 month ago TRAITelecom Scama raja2G spectrum scam2G scamPublic Accounts CommittePAC Report on 2G ScamS Tel

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Excerpts from PAC Report 4

text The report of the Parliaments Public Accounts Committee (PAC), looking into the 2G Spectrum Scam, created a controversy with majority of the committee members (Congress and allies) not in favor of tabling the report. But 2GScam.in brings you excerpts from the report. The PAC report has mentioned a list of things that lead to the scam. Each one is listed as a new post. This is the fourth post which states how the Telecom Ministry over-ruled the views and concerns of the Ministry of Finance. OVERRULING THE VIEWS AND CONCERNS OF THE MINISTRY OF FINANCE The Committee note that one of the Terms of References (ToR) of the Group of Ministers (GoM) constituted on 10 September, 2003 was to recommend how to ensure release of adequate Spectrum needed for the growth of the telecom sector. While discussing this aspect on 30 October, 2003 the GoM decided that the Department of Telecommunications and the Ministry of Finance would discuss and finalise Spectrum pricing formula, which will include incentive for efficient use of Spectrum as well as disincentive for sub-optimal usages. While the GoM of 2006 was constituted, the Planning Commission had suggested on six ToRs which inter-alia included suggestion for a Spectrum Pricing Policy and related matters. But the original ToRs were revised and Spectrum Pricing Policy did not find a place in the revised ToRs. In this context, the Committee find that the then Telecom Minister wrote to the Prime Minister requesting him to delete the Spectrum pricing issue from the ToRs of the GoM. The Committee are startled to observe the manner in which the then Minister of Communication & Information Technology succeeded in getting revised the terms of reference of the GoM issued by the Cabinet Secretariat under the orders of PMO on 27th November, 2006 excluding the matter of spectrum pricing from the purview of Ministry of Finance and leaving it solely to the Deptt. of Telecommunications to decide. In the considered view of the Committee such a decision overriding the Cabinet decision of October 2003 ultimately facilitated the successor MoC&ITs dubious decision leading to the 2G Scam. The Committee are shocked that, as required under the transhttp://www.2gscam.in/post/9574648550/excerpts-from-pac-report-4 Page 1 of 4

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action of Business Rules, modification in the Cabinet decision of Oct. 2003 was never brought before the Cabinet even for ex-post-facto approval. The DoT owes explanation for such a gross dereliction of duty. The Cabinet Secretary and the PMO knew about these developments but did not take corrective action. Shri D.S. Mathur, the former Secretary, DoT while deposing before the Committee, gave an impression that he was dead against the arbitrary way the Communication Minister was functioning. But his correspondences with the Finance Secretary substantiates that he was defending the Minister throughout. The explanation that so long he was in the Ministry he had to defend the policies of the Ministry until he could get the policies changed which he could not and his finally recusing himself from the scene is example where an officer at the verge of retirement does not stand up to protect about what he considers wrong. His claims that he verbally took up the matter with the Cabinet Secretary and the Principal Secretary does not make any sense. Shri Siddharth Behura, another former Secretary, DoT although submitted before the Committee that there was no established procedure in the DoT for process of applications, grant of UAS licence/2G Spectrum etc. and he opposed the method adopted by the Minister, yet he himself became a party to the dirty game. Ms. Manju Madhavan, former Member (Finance), Telecom Commission did not bring to the notice of the Finance Minister/Secretary the disparaging remarks got from the Minister on the file for her rational stance and reasonable and apt suggestions. This is another case where Member (F) also proceeded for retirement. The Committee strongly feel that this situation if allowed to go unchecked, honest and upright officers will ultimately became mute and ineffective and the Government therefore should seriously ponder to remedy the situation. Thus, it becomes apparent that the senior bureaucrats of the DoT were not allowed to discharge their duties properly and effectively, as required for transparent governance. Obviously, the role of Cabinet Secretariat and the PMO remains far from edifying in that they too overlooked the need for compliance with the decision of the Cabinet. What is intriguing is that when the Cabinet Secretary wrote to the Finance Secretary in May, 2007 and Secretary DoT for inclusion of spectrum pricing within the ToR of the GoM consistent with the decision of the Union Cabinet of October 31, 2003, there was no correspondence thereafter from the Ministry of Finance with the Cabinet Secretariat. A close examination of the documents made available to the Committee shows that ToRs of the GoM were revised on the request of the then MoC & IT and the PMO had considered all relevant aspects of the matter including the Cabinet decision of 2003, and the term of reference for the GoM as suggested by the Planning Commission. Strangely, as against the first note initiathttp://www.2gscam.in/post/9574648550/excerpts-from-pac-report-4 Page 2 of 4

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ed in the PMO, the Joint Secretary recorded a prescient note that the terms of reference as suggested in the office note may not be acceptable to the MoC & IT and it would lead to delay in the commencement of work by the GoM and thus the ToRs were revised as acceptable to MoC & IT with the specific approval of the Prime Minister. To a query of the Committee, PMO clarified that not giving effect to Cabinet decision tantamounts to varying or reversing the Cabinet decision but strangely, they claimed that they had no record to indicate that the Cabinet decision of 2003 was not being followed and clarified that a duty was cast on the Department concerned to give effect to the Cabinet decision. The Cabinet Secretariat has washed off hands by stating that the responsibility of ensuring compliance with the directions of the Cabinet or its Committees rests with the Ministry/Department concerned. What further irks the Committee is the reply of the PMO that there is no specific requirement for the PMO to enforce Cabinet decisions and nor is this the general practice. The Committee wonder if it is not the duty of the PMO or the Cabinet Secretariat to enforce the Cabinet decisions in letter and spirit who else is entrusted with this responsibility? The Committee are of the firm opinion that if it was not a requirement earlier on the part of the Cabinet Secretariat and the PMO to ensure the enforcement of the Cabinet decision, the 2G Spectrum scam should be an eye opener for them to at least now start the practice and vigorously monitor the effective compliance to every Cabinet decision. Further, in the context of the role of the Ministry of Finance when the former Secretary DEA was asked as to what transpired after the letter of 29 Nov. 2007 written by Secretary DoT to him, he admitted that there was no exchange of correspondence thereafter but certainly discussions went on. Asked to furnish documentary evidence, he said that everything was not reduced in writing in the Govt, though it was professionally inappropriate, but due to pressure of work it so happened. He further submitted that though things did appear in the papers about the happenings in the DoT but the DEA was not sure that the licences would be issued on a particular date. He failed to recall any reference made by him to the Cabinet Secretariat but admitted he should have briefed the FM. He also admitted lack of due diligence by the Ministry of Finance in the matter. The examination of the files of DEA by the Committee disclosed that on receipt of the last letter dated 29 Nov. 2007 sent by Secretary, DoT to the Finance Secretary, a selfcontained note was put up by Director (Infrastructure) DEA marked to JS(OT)/AS(EA). The file was returned without any marking or signatures as if the whole matter was to be kept at arms length by superior authorities in the Ministry of
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Finance though gravity of the occasion warranted swift and drastic action on their part but instead chose to be a mute spectator. Another example of callous and irresponsible bureaucratic practice followed by the DoT and the Ministry of Finance can be well gauged from the fact that the DoT in its letter dated 15th June, 2007 informed the Ministry of Finance that Spectrum pricing and charges being dynamic issues, are to be considered from time to time in consultation with TRAI, but the Ministry of Finance apprised the Committee that they never received this letter. So, it is apparent that some foul game was being played in the corridors of these Ministries. The Committee demand an investigation of this mysterious episode and desire an explanation thereafter to ascertain which Ministry was at fault. Thus, taking note of the above sequence of events that preceded the distortion of the ToRs of the GoM-2006 to remove the Spectrum pricing issue, the Committee cannot but conclude that this decision was taken with the knowledge of the DoT, the Ministry of Finance, the Cabinet Secretariat and the PMO. It is true that not only serious systemic flaws have crept in the governance of these Ministries/Departments but also the malady is deep rooted. The Committee are shocked and dismayed to note that the Finance Minister, in his note dated 15th January, 2008 acknowledged that Spectrum is a scarce resource and the price of Spectrum should be based on its scarcity value and efficiency of usage but made a unique and condescending suggestion that the matter be treated as closed. The Committee believe that ends of accountability demand that any wrongful loss caused to the Government is made good and the guilty brought to justice. The Committee view it most unfortunate that the Finance Minister, the guardian of the public exchequer and entrusted with the principal task of mobilization of resources for public welfare, instead of initiating stringent and swift action against all those responsible for the whopping loss to the exchequer pleaded with the Prime Minister to treat the matter closed. blog comments powered by Disqus 1 month ago 2G spectrum scam2G scamPranab MukherjeeTelecom ScamA RajaPAC Report on 2G ScamPublic Accounts CommitteFinance Ministrydepartment of telecom

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2G and Pranabs secret note

text The role of another top UPA minister in the 2G Spectrum Scam is coming under scrutiny as the Opposition has now trained its gun to Finance Minister Pranab Mukherjee, who made a statement that he had nothing to do with the pricing of 2G spectrum. But facts state otherwise. The controversial PAC report on the 2G spectrum, however, mentions a letter written by former Telecom Minister A Raja to Prime Minister Manmohan Singh on December 26, 2007, in which he writes about his discussion with then External Affairs Minister about 2G pricing. The PAC report states: The Committee, therefore, took note of the Minister of Communications & ITs information to the PM in his letter dated 26th December, 2007 that his discussion with the External Affairs Minister had enlightened him to take a pre-emptive and pro-active decisions on the issues concerned. And asked the office of the Minister of Finance (the then External Affairs Minister) to furnish a factual note on the claims of the Minister of Communication & IT. When the PAC inquired about this, the Private Secretary to the Finance Minister Pranab Mukherjee, in a letter dated 25th March, 2011, furnished the factual comments based on the Finance Ministers recollection, which are as under: In November, 2007, Honble Prime Minister had asked Shri Pranab Mukherjee, the then External Affairs Minister, to apprise himself fof the issues raised by COAI and some GSM spectrum with Shri A. Raja, the then Minister of Communications & IT, and Shri G.E. Vahanvati, the then Solicitor General (SG), in the context of proceedings pending in the TDSAT. In this context, Shri Pranab Mukherjee held a meeting with MoCIT and SG in the first week of December, 2007. SG explained that the existing operators were insisting on the allocation of additional GSM spectrum on the basis of March, 2006 guidelines which they contended were adequate. There was no substance in this contention in view of the TRAI recommended revised criteria which was stricter and was under further consideration. SG explained that as per the directions of the TDSAT, an affidavit had been filed in November, 2007 indicating the way forward. Shri Pranab Mukherjee briefly discussed the merits of
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the case and enquired whether any order had been passed by TDSAT. He was informed that there was no adverse order at that state. The meeting lasted for about 15 minutes. The PAC report further states: On 7th April, 2011 the Private Secretary to the Finance Minister wrote another letter wherein he stated that subsequent to his letter dated 25th March, 2011, the Finance Ministry had received copies of some papers sent by the PMO to the PAC. In the said papers, there was a reference to a To Secret note dated 26th December, 2007 on the subject of telecom licence and spectrum issues addressed by Shri Pranab Mukherjee, the then External Affairs Minister to the Prime Minister. As no copy of the note was retained in Shri Pranab Mukherjees office, the said note alongwith the enclosures was obtained from the PMO and sent to the PAC. A perusal of the then External Affairs Ministers note revealed that the Minister had interalia unambiguously opined that while it is the prerogative of the Government to frame, revise and change the policy, it is also the responsibility of the Government to do so in a transparent manner and then follow the stated policy both in letter and spirit. He also recorded that while under the existing policy, the Government may keep on issuing new licences, the criteria for the grant of licences may be strengthened and put in public domain at the earliest. blog comments powered by Disqus 1 month ago Finance Ministry2G scam2G spectrum scamTelecom ScamA RajaManmohan SinghPranab Mukherjee

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