National News

No strictures against Manmohan: Pawar

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Saturday, 04 February 2012 09:02

Defending the Centre, Union Agriculture Minister Sharad Pawar on Friday said the Supreme Court had not indicted Prime Minister Manmohan Singh or the government in the 2G spectrum scam case in its Thursday order cancelling 122 licences.

Responding to questions at a press conference here, Mr. Pawar said he had only just got a copy of the judgment and a cursory glance through the pages showed that Dr. Singh had written to the then Telecom Minister A. Raja on November 2, 2007, urging fairness and transparency in the 2G spectrum allocation.

The judges noted that the former Minister did not bother to accept the Prime Minister's suggestion on allocation. This clearly indicated that there were no strictures on the Prime Minister, and the judges felt he had done his job, Mr. Pawar said. “I don't think the blame falls on the PM,” Mr. Pawar said, in response to questions on collective responsibility and if Dr. Singh was responsible for the scam. The allocation was not a Cabinet decision but that of an individual Ministry, he said, adding that the government would require some time to apply its mind after the order.

Following the court order, Mr. Pawar felt, the allotment system in the agro sector needed to be scrapped and a committee could be appointed for major decisions. The verdict also indicated that the government had to take a cautious approach before taking any decisions which, on the flipside, might delay the process, he said.

Both internationally and nationally, within the investor community, the order would be debated and the possibility of repercussions on investments could not be ruled out, Mr. Pawar said.

Karunanidhi rejects Sibal's charge against Raja

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Saturday, 04 February 2012 08:58

DMK president M. Karunanidhi rejected Union Communications Minister Kapil Sibal's accusation that former Minister A. Raja had failed to heed the advice of Prime Minister Manmohan Singh and Union Minister P. Chidambaram on the 2G spectrum allocation.

“If he (Kapil Sibal) has said it, the same deserves a denial. It was Kapil Sibal who, in the beginning, said that the first-come-first-served basis was followed even in 2003 when the BJP was in power. I don't know whether he was going back on his earlier opinion. If irregularities had been committed, BJP ministers in that place should also face punishment,” he told reporters after the general council meeting of the party.

Asked about the reports that that some members of the general council spoke against the alliance with the Congress, Mr. Karunanidhi said indeed a few members wondered whether the DMK should continue its alliance since the Congress failed to do many good things for Tamil Nadu, besides deserting the Sri Lankan Tamils and failing to protect Tamil fishermen from the attacks by the Sri Lankan Army.

Supreme Court scraps UPA's 'illegal' 2G sale

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Friday, 03 February 2012 09:01

Declaring the allocation of 2G spectrum by the Congress-led United Progressive Alliance (UPA) government “illegal” and an example of the arbitrary exercise of power, the Supreme Court on Thursday cancelled all 122 telecom licences allotted on or after January 10, 2008 to 11 companies during the tenure of the former telecom minister, A. Raja.

Click here for a .pdf of the Supreme Court order

Click here for a .pdf of the graphic

Holding that spectrum was a natural resource, the court said natural resources “are vested with the government as a matter of trust in the name of the people of India, and it is the solemn duty of the state to protect the national interest, and natural resources must always be used in the interests of the country and not private interests.”

Allowing writ petitions filed by the Centre for Public Interest Litigation and others and Janata Party president Subramanian Swamy seeking the cancellation of the licences, a Bench of Justices G.S. Singhvi and A.K. Ganguly said: “The licences granted to the private respondents — Etisalat DB Telecom (Swan Telecom); Unitech Wireless; Loop Telecom; Videocon Telecommunications; S-Tel Ltd; Allianz Infratech; Idea Cellular and Aditya Birla Telecom (Space Communications); Tata Teleservices; Sistema Shyam Tele Services (Shyam Telelink); Dishnet Wireless; [and] Vodafone Essar South — on or after January 10, 2008, pursuant to two press releases issued on January 10, 2008, and the subsequent allocation of spectrum to the licensees are declared illegal and are quashed.”

The licences cancelled include 21 of Videocon, 22 of Unitech Wireless Ltd. (Uninor), nine of Idea, 21 of Loop, six of S-Tel, 21 of Sistema, three of Tatas, 13 of Swan and two of Allianz.

The Bench did not order a CBI probe against P. Chidambaram, then Union Finance Minister (now Home Minister), as demanded by Dr. Swamy, taking note of the fact that he had already filed a private complaint in a special CBI court which had reserved orders.

It was Dr. Swamy's contention that Mr. Chidambaram had played a major role in fixing the prices for the spectrum licence, along with Mr. Raja, and in the dilution of shares by two telecom companies to foreign firms. The Bench asked the special court to decide the matter uninfluenced by the proceedings in the Supreme Court.

The court rejected the plea for setting up a special investigation team (SIT) to monitor the probe in the 2G case. Instead, it asked the CBI to submit its probe report to the Central Vigilance Commission (CVC) for scrutiny. The CVC would then file its report to the Supreme Court. The Bench said the Supreme Court would continue monitoring the probe.

The Bench made it clear that the cancellation of the licences would become operative only after four months. “Within two months, the Telecom Regulatory Authority of India (TRAI) shall make fresh recommendations for [the] grant of licence and [the] allocation of spectrum in [the] 2G band in 22 service areas by auction, as was done for the allocation of spectrum in [the] 3G band. The Central government shall consider the recommendations of the TRAI and take an appropriate decision within the next one month, and fresh licences be granted by auction.

“While Etisalat; Unitech and Tatas who were benefited by a wholly arbitrary and unconstitutional action taken by the DoT [Department of Telecom] for grant of UAS licences and allocation of spectrum in [the] 2G band and who off-loaded their stakes for many thousand crores in the name of fresh infusion of equity or transfer of equity shall pay cost of Rs.5 crore each, respondent Nos. 4 [Loop Telecom], 6 [S-Tel], 7 [Allianz Infratech] and 10 [Shyam Telelink] shall pay cost of Rs.50 lakh each, because they too had been benefited by the wholly arbitrary and unconstitutional exercise undertaken by the DoT for the grant of UAS licences and allocation of spectrum in [the] 2G band.”

The Bench held that there was a fundamental flaw in the first-come, first-served principle, inasmuch as it “involves an element of pure chance or accident.”

It said: “In matters involving award of contracts or grant of licence or permission to use public property, the invocation of the first-come, first-served principle has inherently dangerous implications.”

Raja threw public interest to the winds; favoured firms at the cost of exchequer, says Supreme Court

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Friday, 03 February 2012 08:58

The exercise undertaken by officials of the Department of Telecommunications between September 2007 and March 2008, under the leadership of the then Minister A. Raja, was wholly arbitrary, capricious and contrary to the public interest, besides being violative of the doctrine of equality, the Supreme Court ruled on Thursday.

After analysing the records, a Bench of Justices G.S. Singhvi and A.K. Ganguly said: “The material produced before the court shows that the Minister [Mr. Raja] wanted to favour some companies at the cost of the public exchequer, and for this purpose, he took the following steps: soon after his appointment as Minister, he directed that all applications received for grant of UAS licence should be kept pending till the receipt of TRAI recommendations; the recommendations made by the TRAI on August 28, 2007 were not placed before the full Telecom Commission which, among others, would have included the Finance Secretary. The notice of meeting of the Telecom Commission was not given to any of the non-permanent members, despite the fact that the recommendations made by TRAI for allocation of spectrum in the 2G bands (800, 900 and 1800 Mhz) had serious financial implications. (This has been established from the pleadings and the records produced before this court that after issue of licences, three applicants transferred their equities for a total sum of Rs. 24,493 crore in favour of foreign companies).”