2G Verdict : No Fire Found Amidst Sky Pack Smokes

Sunday Editorial

Satyabrata Dwibedy

All the accused of 2G scam acquitted. Without accusing the system,let us accept it.Great people involved with this  scam are all belong to privileged group ,practically they can’t be convicted in the present system,because they can hire the best group of advocates,they have the prowess and all kind of influence to motivate the entire chain of stake holders.

Relevantly one gentleman has pointed out the terms of punishment of Madhu Koda with a great ridicule,one chain snatcher is being punished with 5 years of imprisonment,where as a thug who has looted national resources amounting to thousands of crorers like Madhu Koda was punished with 3 years of imprisonment.The term “discretion” has a very bad utilization in India without logic.

Looking into the 2G verdict now we are bound to believe that the Neera Radia tape revelations were false.Estates purchased by A.Raja in Amazon valley were false.High profile Journalists like Barkha Dutt and Veer Sanghvi mediating for corporate are false.No scams had ever been made in the telecom sector of India for which the then telecom Minister Late Pramod Mahajan had resigned for allegedly favoring Reliance Telecom(RIM).Dr Manmohan Singh was a very effective Prime Minister,without controlled by coterie,as has been wrongly alleged as a “Kath Putli”(Poppet). A.Raja,Kanimozhi are  among the poorest people of India.Really,if these hypothesis were true.

Let us forget,if there is a telecom scam in India in any period either by Sukhram,Pramod Mahajan,A.Raja or by any corporate house of India.

May not have been proved,but there is a plethora of allegations against corresponding governments regarding scams in the telecom sector during their rule.We are just presenting the allegations against different telecom ministers of different Governments and the clues of crony capitalism.

Before forgetting the telecom scams of India,we need to recall the chronology of Telecom Scams of India,date back to the era of Sukhram. Telecom has been a milky cow since the rule of P.V.Narasimha Rao.

Let us start with Sukhram, he was the minister of telecommunications during P.V.Narasimha Rao Government. In 1996 the  CBI seized from his official residence Rs. 3.6 crores in cash concealed in bags and suitcases, which he had collected in connection with irregularities in awarding a telecom contract. He was convicted on 18 November 2011, and sentenced to five years’ rigorous imprisonment by a Delhi court.

Ram’s conviction and his 5-year rigorous imprisonment sentence, pronounced on 19 November 2011, came at a time when the country had witnessed country-wide agitations and indefinite fast by the anti-corruption crusader Anna Hazare.

As a coincidence, Ram, the former union minister of telecommunications, was lodged in the Tihar Prisons Jail No. 1, the same as the one in which another former minister of telecommunications, A.Raja, was lodged as an undertrial. Ram was sentenced for amassing assets disproportionate to his known sources of income.

During Bajpayee rule the period of Pramod Mahajan as telecommunication minister was quite disputed regarding his alleged link with Reliance.

In 2001, he was appointed to the Communications ministry under controversial circumstances. The earlier telecom policy of the government, formulated in 1994, had allowed private participation in cellular telephony after open bidding, on payment of a license fee determined through the bidding. However, after winning the contracts the telecom companies found themselves unable to pay the fixed license fees, supposedly because the victors fell victim to the  Winner’s curse. The then Minister for Communications, Jagmohan,who was widely popular as a honest  bureaucrat attempted tough action  against the defaulting companies, but was sacked. After this, Prime Minister Vajpayee himself took over the cabinet portfolio and oversaw the formulation of the New Telecom Policy of 1999. The policy replaced fixed license fees with a revenue sharing agreement, a move that was widely criticized for changing rules midway and causing loss of revenue to the government. Mahajan, who succeeded to the post in August  2001, after a cabinet reshuffle (that also merged the department of Information technology with the Telecommunications portfolio) had the task of implementing this policy. During his tenure, the number of new telephone connections enjoyed unprecedented growth and rentals fell by a large amount. However, he was also accused of favouring  Reliance(RIL) by allowing it to offer full nationwide mobility through  WLL without payment of the required license fees.

He was also involved in a dispute, with the then Disinvestment minister arun Shourie over the privatization of  VSNL. These controversies may have been the reason why he was dropped from the cabinet in the reshuffle of 2003.

Alleged irregularities as minister of telecom

Mahajan was seen as being close to various lobbyists and corporate houses and there were numerous allegations of financial irregularities during his tenure in the Ministry of Telecom. One of the foremost allegations is his blatant favoring of the Reliance Group in exchange for alleged underhand financial dealings. A relative of  Sudhanshu Mittal, a close associate of Pramod Mahajan and his own son-in-law were found to have been one of the beneficiaries of benami shares of Reliance Industries being transferred into shell companies.

Further, In 2006, Reliance Infocomm offered one crore shares to three companies – Prerna Auto, Fairever Traders and Softnet – at the rate of Re 1 a share. These three companies are owned by Ashish Deora, the business partner of  Rahul Mahajan, Pramod Mahajan’s son. The gifting of these shares and allegations of quid pro quo gained prominence in the light of the favouritism shown towards Reliance by Pramod Mahajan when he was the minister for Telecommunications.

Then comes the much hyped 2G Scam of UPA-DMK,leading the front by Maran and A.Raja, all from DMK.

India is divided into 22 telecommunications zones, with 281 zonal licenses. In 2008, 122 new Second Generation(2G) Unified Access Service (UAS) licenses were granted to telecom companies on a first-come, first-served basis at the 2001 price. According to the CBI charge sheet, several laws were violated and bribes were paid to favor certain firms in granting 2G spectrum licenses. According to a CAG audit, licenses were granted to ineligible corporations, those with no experience in the telecom sector (such as Unitech and Swan Telecom) and those who had concealed relevant information. Although former  Prime Minister Manmohan Singh advised Raja to allot 2G spectrum transparently and revise the license fee in a November 2007 letter, Raja rejected many of Singh’s recommendations. In another letter that month, the Ministry of Finance expressed procedural concerns to the  DOT, these were ignored, and the cut-off date was moved forward from 1 October 2007 to 25 September. On 25 September, the DOT announced on its website that applicants filing between 3:30 and 4:30 pm that day would be granted licenses. Although the corporation was ineligible, Swan Telecom was granted a license for Rs15.37 billion(US$240 million) and sold a 45-percent share to the UAE-based Etisalat for Rs42 billion (US$650 million). Unitech Wireless (a subsidiary of the Unitech Group) obtained a license for Rs16.61 billion (US$260 million), selling a 60-percent share for Rs62 billion (US$970 million) to Norway-based  Telenor.

Alleged role of A.Raja

  • Allegation: A joint investigative report by the CBI and the Income Tax Department alleged that Raja may have received a Rs30 billion(US$470 million) bribe for moving the cut-off date for spectrum applications forward. The changed deadline eliminated many applications, enabling Raja to favour a few applicants. The agencies also alleged that he used accounts in his wife’s name in Mauritius and Seychelles banks for the kickbacks. A CBI charge sheet alleged that Raja conspired with the accused and arbitrarily refined the first-come, first-served policy to ensure that Swan and Unitech received licences. Instead of auctioning 2G spectrum, he sold it at the 2001 rate.

 Alleged Role of M. K. Kanimozhi

  • Allegations: According to the CBI charge sheet, Kanimozhi owns 20 percent of family-owned  Kalaignar TV; her stepmother, Dayalu Ammal, owns 60 percent of the channel. The CBI alleges that Kanimozhi was the “active brain” behind the channel and conspired with Raja to coerce  DB Reality cofounder  Shahid Balwa to funnel Rs2 billion(US$31 million) to Kalaignar TV. Kanimozhi was in regular contact with Raja about the launch of Kalaignar TV. Raja advanced the channel’s cause, facilitating its registration with the  Ministry of I & B and adding it to DTH operator  TATA Sky’s lineup. Kanimozhi was charged with tax evasion by the Income Tax Department in Chennai.

Aircel-Maxis deal controversy

On 6 June 2011 former  Aircel chief C. Sivasankaran complained to the CBI about not receiving a telecom licence and being forced by telecom minister Dayanidhi Maran to sell Aircel to the Malaysia-based  Maxix Communication  group, owned by T. Ananda Krishnan. The licences were allegedly issued after the deal was made. Sivasankaran also alleged that brothers Dayanidhi and  Kalanithi Maran received kickbacks in the form of investments by the Maxis group through the Astro network in  Sun TV Network, owned by the Maran family. In the wake of the allegations, Maran resigned on 7 July.

On 10 October, the CBI registered a case and raided properties owned by the Marans. CBI sources said that although no evidence of coercion was found in the Aircel sale, they found substantial evidence that Maran had favored the company’s takeover by Maxis and deliberately delayed Sivasankar’s files. On 8 February 2012, the Enforcement Directorate registered a money-laundering case against the Maran brothers for allegedly receiving illegal compensation of about Rs5.5 billion in the Aircel-Maxis deal.During the CBI probe Sivasankaran said that the Maran brothers had forced him to sell his 74% share in Aircel to Maxis by threatening his life, giving the CBI a list of over 10 witnesses. In September 2012, the CBI said it finished its Indian investigation and was awaiting the response to a letter rogatory  sent to Malaysia and a questionnaire from T. Ananda Krishnan before filing a chargesheet. On 29 August 2014, the CBI filed a  Chargesheet  against Dayanidhi Maran, his brother Kalanithi Maran, Malaysian businessman T Ananda Krishnan, Malaysian national Augustus Ralph Marshall, six others and four firms — Sun Direct TV Pvt Ltd, Maxis Communication Berhad, Astro All Asia Network PLC and South Asia Entertainment Holding Ltd as accused in the case. On 29 October 2014, special CBI judge OP Saini said that he found enough evidence to proceed with the prosecution and hence summoned former telecom minister Dayanidhi Maran and others as accused. Based on the CBI chargesheet, the Enforcement Directorate (ED) on 1 April 2015, attached Maran brothers’ properties worth Rs 742 crore.

Subramanian Swamy alleged that in 2006 a company controlled by Karti Chidambaram, the son of P.Chidambaram, received a five-percent share of Aircel to get part of Rs40 billion paid by Maxix Communications for the 74-percent share of Aircel. According to Swamy, Chidambaram withheld Foreign Investment Promotion Board clearance of the deal until his son received the five-percent share in Siva’s company. The issue was raised a number of times in Parliament  by the opposition, which demanded Chidambaram’s resignation. Although he and the government denied the allegations, The Pioneer and  India Today  reported the existence of documents showing that Chidambaram delayed approval of the FDI proposal by about seven months.

Though Manmohan Singh claims innocence regarding his involvement in the telecom scams,the continuous allotment of this portfolio to DMK Ministers,knowing clearly that nothing is going right in the DOT,speak volumes of his dishonesty in holding the position of Prime Minister-ship. However no Government so far, after economic liberalization ,is honest in the telecom policies.

The misery is the weak legal actions against these perpetrators.In the changing judicial behavior when scientific evidence and circumstantial evidence are emerging more relevant  then before,how these big shots are finding the escape route is a matter of concern for India.Till this core issue is not addressed judiciously,no escape for India from high profile corruption and scams.



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