2g Case Study

The 2G spectrum case was an alleged scam by the politicians and government officials under the United Progressive Alliance (Congress) coalition government in India.

The Central Bureau of Investigation (CBI) court on Dec 21, 2017 declared no evidence to prosecute the accused and acquitted all accused personnels.[1]

The Union Government of that time was accused of undercharging mobile telephone companies for frequency allocation licenses, which they used to create 2Gspectrum subscriptions for cell phones. The Government chose NM Rothschild & Sons to design a first-of-its-kind e-auction mechanism in the world, a US$2.27 billion landmark deal. The difference between the money collected and that mandated to be collected was estimated by the Comptroller and Auditor General of India at ₹1.76 trillion (US$27 billion), based on 2010 3G and BWA spectrum-auction prices.[2] In a chargesheet filed on 2 April 2011 by the Central Bureau of Investigation (CBI), the loss was pegged at ₹309,845.5 million (US$4.7 billion).[3] In a 19 August 2011 reply to the CBI, the Telecom Regulatory Authority of India (TRAI) said that the government had gained over ₹30 billion (US$460 million) by selling 2G spectrum.[3]

On 2 February 2012, the Supreme Court of India ruled on a public interest litigation (PIL) related to the 2G spectrum allocation. The court declared the allotment of spectrum "unconstitutional and arbitrary", cancelling the 122 licenses issued in 2008 under A. Raja (Minister of Communications & IT from 2007 to 2009), the primary official accused.[4] According to the court, Raja "wanted to favour some companies at the cost of the public exchequer" & "virtually gifted away important national asset[s]."[5] The zero-loss theory was discredited[6] on 3 August 2012 when, after a Supreme Court directive, the Government of India revised the base price for 5-MHz 2G spectrum auctions to ₹140 billion (US$2.1 billion), raising its value to about ₹28 billion (US$430 million) per MHz (near the Comptroller and Auditor General estimate of ₹33.5 billion (US$510 million) per MHz).[7][8]

Although the policy for awarding licences was first-come, first-served, which was introduced during Atal Bihari Vajpayee Government, Raja changed the rules so it applied to compliance with conditions instead of the application itself.[9] On 10 January 2008, companies were given only a few hours to supply Letters of Intent and payments; some executives were allegedly tipped off by Raja, and they (and the minister) were imprisoned.[10][11][12] According to some analysts, many corruption scandals including 2G spectrum case, coal mining scam, Adarsh Housing Society scam and Commonwealth Games scam were major factors behind Congress led UPA government's massive defeat in 2014 Lok Sabha election. The corruption charges were so heavy that Congress couldn't get over from that and thus eventual loss of trust from the party and its leaders.[13][14]Time magazine listed the India's Telecoms Scandal as one of the Top 10 abuses of power.[15]

However, the special court in New Delhi acquitted all accused in the 2G spectrum case including prime accused A Raja and Kanimozhi on December 21, 2017,[16] the verdict was based on the fact that CBI could not find any evidence against the accused in those 7 years. Per the judgement, "Some people created a scam by artfully arranging a few selected facts and exaggerating things beyond recognition to astronomical levels."[17][18]CBI and the Enforcement Directorate will appeal against the Special court acquittal verdict in the Delhi High Court.[19][20]

Background[edit]

India is divided into 22 telecommunications zones, with 281 zonal licenses.[21] 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 favour 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)[22] and those who had concealed relevant information.[23] Although former Prime MinisterManmohan 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.[24] In another letter that month, the Ministry of Finance expressed procedural concerns to the DOT;[24] these were ignored, and the cut-off date was moved forward from 1 October 2007 to 25 September.[24] 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.[24] Although the corporation was ineligible, Swan Telecom was granted a license[22] for ₹15.37 billion (US$240 million) and sold a 45-percent share to the UAE-based Etisalat for ₹42 billion (US$640 million).[22] Unitech Wireless (a subsidiary of the Unitech Group) obtained a license for ₹16.61 billion (US$250 million), selling a 60-percent share for ₹62 billion (US$950 million) to Norway-based Telenor.[22]

The following is a list of companies who received 2G licenses during Raja's term as telecom minister;[25][26] the licenses were later cancelled by the Supreme Court:[27][28]

CompanyTelecom regions# of licensesRemarks
Adonis ProjectsHaryana, Himachal Pradesh, Jammu & Kashmir, Punjab, Rajasthan, Uttar Pradesh (East)6Adonis Projects, Nahan Properties, Aska Projects, Volga Properties, Azare Properties & Hudson Properties were acquired by Unitech. Since Unitech Infrastructure and Unitech Builders & Estates were subsidiaries of Unitech Group, in 2008 Unitech had 22 2G licenses. Later that year, Telenor bought a majority share in the telecom company from the Unitech Group and now provides service as Uninor with 22 licences.
Nahan PropertiesAssam, Bihar, North East, Orissa, Uttar Pradesh (east), West Bengal6
Aska ProjectsAndhra Pradesh, Kerala, Karnataka3
Volga PropertiesGujarat, Madhya Pradesh, Maharashtra3
Azure PropertiesKolkata1
Hudson PropertiesDelhi1
Unitech Builders & EstatesTamil Nadu (including Chennai)1
Unitech InfrastructuresMumbai1
Loop TelecomBihar, Gujarat, Himachal Pradesh, Kerala, Kolkata, Punjab, Rajasthan, Uttar Pradesh, West Bengal, Andhra Pradesh, Delhi, Haryana, Karnataka, Maharashtra, Odisha(Orissa), Tamil Nadu (including Chennai), Assam, Jammu & Kashmir, Madhya Pradesh21
Datacom SolutionsAndhra Pradesh, Assam, Bihar, Gujarat, Haryana, Himachal Pradesh, Jammu & Kashmir, Karnataka, Kerala, Kolkata, Madhya Pradesh, Maharashtra, Odisha, Rajasthan, Tamil Nadu (including Chennai), Uttar Pradesh, West Bengal, Delhi, Mumbai21Operates as Videocon Telecom
Shyam TelelinkMadhya Pradesh, Kerala, Kolkata, Punjab, Uttar Pradesh, West Bengal, Andhra Pradesh, Delhi, Haryana, Karnataka, Maharashtra, Odisha, Tamil Nadu (including Chennai), Assam, Jammu & Kashmir, North East17Shyam Telelink & Shyani Telelink have a combined 21 licenses. In late 2008 Russia-based Sistema bought a majority share in the company, which now operates as MTS India.
Shyani TelelinkMumbai, Bihar, Gujarat, Himachal Pradesh4
Swan TelecomAndhra Pradesh, Gujarat, Haryana, Karnataka, Kerala, Maharashtra, Punjab, Rajasthan, Tamil Nadu (including Chennai), Uttar Pradesh, Delhi, Mumbai13Swan was a subsidiary of Reliance Telecom established to circumvent the one-company-one-license rule. In 2008, Swan merged with Allianz Infratech; late in the year Abu Dhabi's Etisalat bought about 45 percent of the company, renaming it Etisalat DB Telecom.
Allianz InfratechBihar, Madhya Pradesh2
Idea CellularAssam, Punjab, Karnataka, Jammu and Kashmir, North East, Kolkata, West Bengal, Odisha(Orissa), Tamil Nadu (including Chennai)9Since Idea Cellular bought Spice Communications in 2008 for ₹27 billion (US$410 million),[29] of the 122 spectrum licenses sold in 2008 Idea owns 13. Seven are in use by the company, and the remainder are overlapping licenses.[30]
Spice CommunicationsDelhi, Andhra Pradesh, Haryana, Maharashtra4
S TelAssam, Jammu and Kashmir, Odisha(Orissa), North East, Bihar, Himachal Pradesh6In January 2009, Bahrain Telecommunications agreed to buy 49 percent of S Tel for $225 million. Chinnakannan Sivasankaran owns the remaining share.[31][32] In May 2009, Sahara Group bought an 11.7-percent share in S Tel.[33]
Tata TeleservicesJammu and Kashmir, Assam, North East3In late 2008 Tata sold a 26-percent share to the Japanese NTT DoCoMo for about ₹130.7 billion (US$2.0 billion), or an enterprise value of ₹502.69 billion (US$7.7 billion).[34]

Accused parties[edit]

The selling of the licenses drew attention to three groups: politicians and bureaucrats, who had the authority to sell licenses; corporations buying the licenses, and professionals who mediated between the politicians and corporations.

Politicians[edit]

The following charges were filed by the CBI and the Directorate General of Income Tax Investigation in the Special CBI Court.[35][36][37][38]

A. Raja[edit]

  • Political career: Four-time DMK member of Parliament (last won constituency Nilgiris, Tamil Nadu) and now not an MP, maker Union Minister of State for Rural Development (1999) and Health and Family Welfare (2003), former Union Cabinet Minister for Environment and Forests (2004) and Communication and Information Technology (2007 and 2009)[39][40][41][42]
  • Allegation: A joint investigative report by the CBI and the Income Tax Department alleged that Raja may have received a ₹30 billion (US$460 million) bribe for moving the cut-off date for spectrum applications forward.[43][44] The changed deadline eliminated many applications, enabling Raja to favour a few applicants.[43][44] The agencies also alleged that he used accounts in his wife's name in Mauritius and Seychelles banks for the kickbacks.[45] 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.[46] Instead of auctioning 2G spectrum, he sold it at the 2001 rate.[46]
  • Charges: Criminal breach of trust by a public servant (section 409), criminal conspiracy (Section 120-B), cheating (Section 420) and forgery (Sections 468 and 471); booked under the Prevention of Corruption Act for accepting illegal gratification.[35][47][48]
  • Status: Arrested by the CBI on 2 February 2011.[49] Applied for bail on 9 May 2012,[50][51] which was granted on 15 May.[52][53][54] On 21 December 2017, he has been acquitted by a Special CBI Court.[55]

M. K. Kanimozhi[edit]

  • Political career: Daughter of five-time Chief Minister of Tamil NaduM. Karunanidhi. DMK member of Parliament, representing Tamil Nadu in the Rajya Sabha.[56][57]
  • 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.[58] The CBI alleges that Kanimozhi was the "active brain" behind the channel[58] and conspired with Raja to coerce DB Realty cofounder Shahid Balwa to funnel ₹2 billion (US$31 million) to Kalaignar TV.[59] Kanimozhi was in regular contact with Raja about the launch of Kalaignar TV.[59] Raja advanced the channel's cause, facilitating its registration with the Ministry of Information and Broadcasting and adding it to DTH operator TATA Sky's lineup. Kanimozhi was charged with tax evasion by the Income Tax Department in Chennai.[59]
  • Charges: Criminal conspiracy to cause criminal breach of trust by a public servant and criminal conspiracy (Section 120-B), cheating (Section 420) and forgery (Sections 468 and 471), and booked under the Prevention of Corruption Act.[35][47]
  • Status: Arrested by the CBI on 20 May 2011.[60][61] Granted bail on 28 November 2011, after 188 days in custody.[62][63] On 21 December 2017, she has been acquitted by a Special CBI Court.[55]

Bureaucrats[edit]

A number of bureaucrats were named in the CBI charge sheet filed in its Special Court.[35][36][37][38]

Siddharth Behura[edit]

  • Position: Telecom Secretary when the licenses were granted.[35][64]
  • Allegations: According to the CBI charge sheet, Behura conspired with Raja and several others. When the application deadline time was declared, from 3:30 to 4:30 pm Behura closed counters to block other telecom companies.[22]
  • Charges: Criminal breach of trust by a public servant (Section 409), criminal conspiracy (Section 120-B), cheating (Section 420) and forgery (Sections 468 and 471); booked under the Prevention of Corruption Act for accepting illegal gratuities.[35][65]
  • Status: Arrested by the CBI on 2 February 2011[49] and granted bail on 9 May 2012,[66][67] and finally acquitted on 21 December 2017 by a Special CBI Court for lack of convincing evidence.[55] In a 10 July 2012 joint parliamentary committee deposition, Behura blamed Raja for most of the decisions related to 2G spectrum auctions.[68]

RK Chandolia[edit]

  • Position: Raja's private secretary when the licenses were granted.[35][69]
  • Allegations: According to the CBI charge sheet Chandolia, like Behura, conspired with Raja and several others; when the application deadline time was declared from 3:30 to 4:30 pm, Chandolia joined Behura in shutting counters to physically block other telecom companies.[22]
  • Charges: Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy (Section 120 B), cheating (Section 420) and forgery (Sections 468 and 471); booked under the Prevention of Corruption Act[35]
  • Status: Arrested by the CBI on 2 February 2011.[49] Although he was granted bail by the special CBI court on 1 December 2011, the following day the High Court took suo motu notice of newspaper reports of the bail and stayed it.[70] Chandolia appealed to the Supreme Court, and on 9 May 2012 the court upheld the bail grant.[71] He was acquitted on 21 December 2017 by a Special CBI Court for lack of substantial evidence.[55]

Executives[edit]

A number of executives were accused in the CBI charge sheet.[35][36][37][38]

Sanjay Chandra[edit]

  • Position: Former Unitech Wireless managing director[35]
  • Charges: Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy (Section 120-B), cheating (Section 420) and forgery (Sections 468 and 471); booked under the Prevention of Corruption Act[35]
  • Allegations: Former CBI prosecutor AK Singh was implicated in a taped conversation sharing legal strategy and privileged information with Chandra.[72][73]
  • Status: Arrested by the CBI on 20 April 2011[74][75] and granted bail on 24 November,[76] As of 21 December 2017 he has been acquitted by a special CBI Court.[55]

Umashankar[edit]

As of 21 December 2017 he has been acquitted by a special CBI Court.[55]

Gautam Doshi[edit]

  • Position: Managing director, Reliance Anil Dhirubhai Ambani Group[35]
  • Charges: Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy (Section 120-B), cheating (Section 420) and forgery (Sections 468 and 471); booked under the Prevention of Corruption Act[35]
  • Status: Arrested by the CBI on 20 April 2011[74] and granted bail on 24 November,[76] As of 21 December 2017 he has been acquitted by a special CBI Court.[55]

Hari Nair[edit]

  • Position: Senior vice-president, Reliance Anil Dhirubhai Ambani Group[35]
  • Charges: Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy (Section 120-B), cheating (Section 420) and forgery (Sections 468 and 471); booked under the Prevention of Corruption Act[35]
  • Status: Arrested by the CBI on 20 April 2011[74] and granted bail on 24 November,[76] As of 21 December 2017 he has been acquitted by a special CBI Court.[55]

Surendra Pipara[edit]

  • Position: Senior vice-president, Reliance Anil Dhirubhai Ambani Group[35]
  • Charges: Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy (Section 120-B), cheating (Section 420) and forgery (Sections 468 and 471); booked under the Prevention of Corruption Act[35]
  • Status: Arrested by the CBI on 20 April 2011[74] and granted bail on 24 November.[76] As of 21 December 2017 he has been acquitted by a special CBI Court.[55]

Vinod Goenka[edit]

  • Position: Managing director, DB Realty and Swan Telecom[35]
  • Charges: Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy (Section 120 B), cheating (Section 420), forgery (Sections 468 and 471) and fabrication of evidence (Section 193); booked under the Prevention of Corruption Act[35]
  • Status: Arrested by the CBI on 20 April 2011[74] and granted bail on 24 November.[76] As of 21 December 2017 he has been acquitted by a special CBI Court.[55]

Shahid Balwa[edit]

  • Position: Corporate promoter, DB Realty and Swan Telecom[35]
  • Charges: Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy (Section 120-B), cheating (Section 420), forgery (Sections 468 and 471) and fabrication of evidence (Section 193); booked under the Prevention of Corruption Act[35]
  • Status: Arrested by the CBI on 8 February 2011[77] and granted bail on 29 November,[78] acquitted on 21 December 2017 by a special CBI Court.[55]

Asif Balwa[edit]

  • Position: Director, Kusegaon Fruits and Vegetables[35]
  • Charges: Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy (Section 120-B), cheating (Section 420), forgery (Sections 468 and 471) and fabrication of evidence (Section 193); booked under the Prevention of Corruption Act[35]
  • Status: Arrested by the CBI on 29 March 2011[79] and granted bail on 28 November,[80] acquitted on 21 December 2017 by a special CBI Court.[55]

Rajiv Agarwal[edit]

  • Position: Director, Kusegaon Fruits and Vegetables[35]
  • Charges: Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy (Section 120-B), cheating (Section 420), forgery (Sections 468 and 471) and fabrication of evidence (Section 193); booked under the Prevention of Corruption Act[35]
  • Status: Arrested by the CBI on 29 March 2011[79] and granted bail on 28 November,[80] acquitted on 21 December 2017 by a special CBI Court.[55]

Sharath Kumar[edit]

  • Position: Managing director, Kalaignar TV[35]
  • Charges: Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy (Section 120-B), cheating (Section 420), forgery (Sections 468 and 471) and fabrication of evidence (Section 193); booked under the Prevention of Corruption Act[35]
  • Status: Arrested by the CBI on 20 May 2011[81] and granted bail on 28 November 2011,[82] acquitted on 21 December 2017 by a special CBI Court.[55]

Ravi Ruia[edit]

  • Position: Vice-chair, Essar Group[83][84]
  • Charges: Criminal conspiracy (Section 120 B) and cheating (Section 420)[83][84]
  • Status: At large;[85] as of August 2012, acquitted while at large on 21 December 2017 by a special CBI Court.[55]

Anshuman Ruia[edit]

  • Position: Director, Essar Group[83][84]
  • Charges: Criminal conspiracy (Section 120 B) and cheating (Section 420).[83][84]
  • Status: At large;[85] acquitted while at large on 21 December 2017 by a special CBI Court.[55]

Vikas Saraf[edit]

  • Position: Director of strategy and planning, Essar Group[83][84]
  • Charges: Criminal conspiracy (Section 120 B) and cheating (Section 420 of the Indian Penal Code)[83][84]
  • Status: At large;[85] acquitted while at large on 21 December 2017 by a special CBI Court.[55]

Ishwari Prasad Khaitan[edit]

  • Position: Corporate promoter, Loop Telecom[83][84]
  • Charges: Criminal conspiracy under (Section 120 B) and cheating (Section 420)[83][84]
  • Status: At large;[85] acquitted while at large on 21 December 2017 by a special CBI Court.[55]

Kiran Khaitan[edit]

  • Position: Corporate promoter, Loop Telecom[83][84]
  • Charges: Criminal conspiracy (Section 120 B) and cheating (Section 420)[83][84]
  • Status: At large;[85] acquitted while at large on 21 December 2017 by a special CBI Court.[55]

Karim Morani[edit]

  • Position: Corporate promoter and director, Cineyug Films[35]
  • Allegations: According to the Income Tax Department charge sheet, Morani-owned Cineyug Films was a part of the route used by Shahid Balwa to funnel[86]₹2 billion (US$31 million) illegally to Kalaignar TV.[86] DB Realty corporate promoters Shahid Balwa and Vinod Goenka transferred ₹2,092.5 million (US$32 million) to Kusegaon Fruits and Vegetables, where Balwa's younger brother Asif was a director.[86][87] Kusegaon then transferred ₹2 billion (US$31 million) to Cineyug Films, and Morani transferred it to Kalaignar TV.[86]
  • Charges: Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy (Section 120-B), cheating (Section 420), forgery (Sections 468 and 471) and fabrication of evidence (Section 193); booked under the Prevention of Corruption Act[35]
  • Status: Arrested by the CBI on 30 May 2011[88] and granted bail on 28 November,[82] promptly acquitted on 21 December 2017 by a "special CBI Court".[55]

Corporations[edit]

Several companies were named in the CBI charge sheet.[35][36][37][38]

Unitech Wireless[edit]

  • Charges: Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy (Section 120-B), cheating (Section 420) and forgery (Sections 468 and 471) [35]
  • Status: The company was acquitted on 21 December 2017 of any wrongdoing by Special CBI Court.[55]

Reliance Telecom[edit]

  • Charges: Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy (Section 120-B) and cheating (Section 420)[35]
  • Status: As of December 2017, acquitted in 2G spectrum case.[89]

Swan Telecom[edit]

  • Charges: Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy (Section 120-B) and cheating (Section 420)[35]
  • Status: The company was acquitted on 21 December 2017 of any wrongdoing by a Special CBI Court that was appointed for the purpose of acquitting the accused.[55]

Other companies named in the charge sheet were:[90][91][92]

  • Loop Telecom
  • Loop Mobile India
  • Essar Tele Holding
  • Essar Group (corporate parent of Essar Tele Holding)

Media role[edit]

Main article: Radia tapes controversy

OPEN and Outlook reported that journalists Barkha Dutt (editor of NDTV) and Vir Sanghvi (editorial director of the Hindustan Times) knew that corporate lobbyist Nira Radia influenced Raja's appointment as telecom minister,[93] publicising Radia's phone conversations with Dutt and Sanghvi[94][95] when Radia's phone was tapped by the Income Tax Department. According to critics, Dutt and Sanghvi knew about the link between the government and the media industry but delayed reporting the corruption.[93]

Chronology[edit]

The Centre for Public Interest Litigation filed the first petition against the Union of India for irregularities in awarding 2G spectrum licenses. The petition alleged that the government lost $15.53 billion by issuing spectrum in 2008 based on 2001 prices, and by not following a competitive bidding process. This led to further petitions, and an investigation began in 2010.[96]

2007[edit]

  • May: A Raja becomes Telecom Minister.[97]
  • August: Allotment of 2G spectrum and Universal Access Service (UAS) licences by the Department of Telecommunications (DoT) begins.
  • 25 September: The Telecom Ministry issues a press release that its deadline for application is 1 October.
  • 1 October: DoT receives 575 applications for UAS licences from 46 companies.[98]
  • 2 November: The prime minister writes to Raja, directing him to ensure the allotment of 2G spectrum in a fair and transparent manner and to ensure that the licence fee was revised. Raja rejects many of the prime minister's recommendations.
  • 22 November: In a letter to the DoT, the Finance Ministry raises procedural concerns. Its demand for a review is rejected.

2008[edit]

  • 10 January: The DoT decides to issue licences on first-come, first-served basis, advancing the cut-off date from 1 October to 25 September and announcing on its website that those applying between 3.30 and 4.30 pm would be granted licences in accordance with policy.[99][100]
  • Total collection from sale of 122 licenses was about 9200 Crore.[1]
  • Swan Telecom, Unitech and Tata Teleservices sell shares at much higher prices to Etisalat, Telenor and DoCoMo, respectively.[101][102][103]

2009[edit]

  • 4 May: A telecom-watchdog NGO files a complaint with the Central Vigilance Commission (CVC) on illegalities in spectrum allocation to Loop Telecom.
  • 19 May: Another complaint is filed with the CVC by Arun Agarwal, highlighting the low-cost spectrum grant to Swan Telecom. The CVC directs the CBI to investigate irregularities in the allocation of 2G spectrum.
  • 1 July: Responding to a petition from S-Tel, the Delhi High Court rules the advancement of the cut-off date illegal.[104]
  • 21 October: The CBI registers a case, filing a First Information Report against unknown officers of the DoT and unknown private persons and companies under provisions of the Indian Penal Code and the Prevention of Corruption Act.
  • 22 October: The Directorate General of Income Tax Investigation raids DoT offices.[105][106][107]
  • 16 November: The CBI investigates a wiretapped conversation by corporate lobbyist Nira Radia to learn the involvement of middlemen in the grant of spectrum to telecom companies, seeking information from the Directorate General of Income Tax Investigation about Radia and her company.

2010[edit]

  • 13 March: The Supreme Court upholds the Delhi High Court ruling that the cutoff-date advancement was illegal.[108][109]
  • 31 March: According to the Comptroller and Auditor General, there were large-scale irregularities in spectrum allocation.
  • 2 April: CBI Deputy Inspector General of Investigations Vineet Agarwal and Indian Revenue Service Director General of Income Tax Investigations Milap Jain, who were investigating the case, are transferred; Jain becomes Director General of International Taxation.[110]
  • 6 May: Telephone conversation between Raja and Niira Radia, recorded by the Directorate General of Income Tax Investigation, made public.[111] the Centre for Public Interest Litigation petitions the Delhi High Court for a special investigation of the case.
  • 25 May: Petition dismissed by the court.
  • August: Dismissal appealed to the Supreme Court.
  • 18 August: High Court refuses to order the prime minister to rule on a request by Janata Party chief Subramanian Swamy to prosecute Raja.
  • 13 September: The Supreme Court asks the government and Raja to reply within 10 days to three petitions filed by the CPIL and others alleging a ₹70,000 crore (US$11 billion) scam in granting telecom licences in 2008.
  • 24 September: Swamy petitions the Supreme Court to order the PM to prosecute Raja.
  • 27 September: The Directorate General of Income Tax Investigation informs the Supreme Court of a probe of firms suspected to have violated the Foreign Exchange Management Act, saying it cannot confirm or deny Raja's involvement.
  • 8 October: The Supreme Court asks the government to respond to the Comptroller and Auditor General report about the case.[112]
  • 21 October: Draft reports from the CAG are presented to the Supreme Court.
  • 29 October: The Supreme Court criticises the CBI for its slowness in investigating the case.[113][114]
  • 10 November: The CAG submits a report on 2G spectrum to the government, stating a loss of ₹176,000 crore (US$27 billion) to the exchequer.
  • 11 November: The DoT files a Supreme Court affidavit that the CAG lacked the authority to question the 2008 policy decision.
  • 14 November: Raja resigns as telecom minister.[115][116]
  • 15 November: Kapil Sibal placed in charge of Telecom Ministry.[117][118]
  • 20 November: Affidavit on behalf of the PM filed in Supreme Court rejecting the charge of inaction on Swamy's complaint.[119][120][121]
  • 22 November: The CBI and the Directorate General of Income Tax Investigation tell the SC they will file a charge sheet within three months, and the CBI says it will investigate the role of Niira Radia.
  • 24 November: The SC reserves verdict on Swamy's request to the PM to prosecute Raja.
  • 25 November: The SC criticises the CBI for not questioning Raja.
  • 29 November: The CBI files a status report on the probe.
  • 30 November: The SC questions the Central Vigilance Commission's P. J. Thomas' fitness to supervise the CBI probe, since he was Telecom Secretary at that time.[122]
  • 1 December: The SC orders the original tapes of conversations by Radia. Raja questions the CAG findings.
  • 2 December: The government supplies Directorate General of Income Tax Investigation tapes to the SC, which criticises Raja for ignoring the PM's advice to delay the spectrum allocation.
  • 8 December: SC favours including 2001 (when first-come, first-served was the norm for spectrum allocation) in the probe period and asks the government to consider a special court. The Directorate General of Income Tax Investigation reports a money trail covering 10 countries, including Mauritius.
  • 14 December: PIL filed in SC, seeking the cancellation of new telecom licences and 2G spectrum allocated under Raja.
  • 15 December: Swamy petitions a Delhi court for his inclusion as a public prosecutor, saying Raja favoured "ineligible" companies Swan Telecom and Unitech Wireless in allocating spectrum.
  • 16 December: The SC decides to monitor the CBI inquiry.[123][124][125]

2011[edit]

  • 4 January: Swamy petitions the SC for cancellation of the licenses.
  • 10 January: Supreme Court notifies the government of Swamy's petition, and issues notices to 11 companies which allegedly did not fulfill the roll-out obligations or were ineligible.
  • 30 January: The government's decision to regularise the licenses of companies which failed to meet the deadline is challenged in the Supreme Court.
  • 2 February: Raja, former Telecom Secretary Siddharth Behura and Raja's former personal secretary, R. K. Chandolia, are arrested.
  • 8 February: Raja is remanded to two more days of CBI custody, and Behura and Chandolia are placed in judicial custody. Swan Telecom corporate promoter Shahid Usman Balwa is arrested.
  • 10 February: The Supreme Court asks the CBI to investigate corporations which were beneficiaries of the spectrum allocation. Raja and Balwa are remanded to CBI custody for four more days by a special CBI court.
  • 14 February: Raja's custody is extended by three days, and Balwa's for four.
  • 17 February: Raja is sent to Tihar Jail under judicial custody.
  • 18 February: The Directorate General of Income Tax Investigation questions Kani Mozhi at its Chennai headquarters.
  • 24 February: The Directorate General of Income Tax Investigation tells a Delhi court that Balwa facilitated transactions to Kalaignar TV.
  • 28 February: Raja requests video-conferenced judicial proceedings, saying that he is threatened by other inmates.
  • 1 March: The CBI tells the SC that 63 people are under investigation. Raja appears in CBI court via video-conference.
  • 14 March: The Delhi High Court establishes a special court. Balwa is also allowed to appear via video-conference.
  • 17 March: The SC reserves judgment on licence cancellations, rejecting corporate claims that estoppel cannot be applied to protect illegality.[126][127]
  • 29 March: The SC allows the CBI to file its chargesheet on 2 April instead of 31 March. Asif Balwa and Rajeev Agarwal are arrested.
  • 2 April: The CBI files its first chargesheet.[128][129][130]
  • 25 April: The CBI files a second chargesheet, and Kanimozhi, Sharad Kumar and Karim Morani are summoned.[131][132][133]
  • 6 May: Kanimozhi and Sharad Kumar appear, requesting bail, and Morani requests an appearance exemption on medical grounds.[134][135][136] The SC issues a contempt of court notice to Sahara India Pariwar managing director Subrata Roy and two others for alleged interference in the Directorate General of Economic Enforcement investigation.[137][138]
  • 7 May: The special CBI court reserves judgment on Kanimozhi and Kumar's bail requests.
  • 14 May: The special CBI court postpones judgment on the bail pleas for 20 May.
  • 20 May: The special court refuses Kanimozhi and Kumar's bail requests, ordering their arrest to prevent witness-tampering.[139][140]
  • 8 June: Delhi HC judge Ajit Bharihoke again refuses bail Kanimozhi and Kumar's bail requests.[141][142]
  • 20 June: The SC refuses Kanimozhi's bail request.[143][144][145]
  • 25 July: Arguments begin, with Raja wanting to summon the prime minister and former finance minister P. Chidambaram as witnesses.
  • 26 August: The special CBI court allows Subramanian Swamy to argue his own case, primarily to address possible loopholes in its investigation.[146][147]
  • 30 August: The Directorate General of Income Tax Investigation freezes accounts and attaches properties worth ₹223 crore (US$34 million) belonging to five companies (primarily related to DB Realty under the Prevention of Money Laundering Act (PMLA)).[148][149]
  • 1 September: The Enforcement Directorate files a status report in Supreme Court of a Foreign Exchange Management Act violation of ₹ 100 billion.[150]
  • 15 September: Swamy requests that P. Chidambaram should be charged.[151]
  • 22 September: The CBI defends Chidambaram in the SC, blaming the DoT.
  • 26 September: The CBI requests criminal-breach-of-trust charges for Raja, Chandolia and Behura.[152][153]
  • 9 October: The CBI files a First Information Report against Maran and his brother in the Aircel-Maxis deal.[154][155][156]
  • 10 October: The SC reserves judgment on Swamy's request for a probe of Home Minister Chidambaram's role in the matter.[157][158] The CBI arrests former telecom minister and DMK leader Dayanidhi Maran and his brother, Kalanithi Maran.[159]
  • 22 October: The special CBI court finds prima facie evidence to try the 17 accused (including Raja) on charges including criminal conspiracy, breach of trust, cheating and forgery.[160][161]
  • 3 November: The special CBI court dismisses bail requests of all eight applicants, including Kanimozhi.[162]
  • 8 November: The special court orders CBI to provide Swamy with copies of files on equity sales by telecom companies in its investigation of P. Chidambaram's involvement.[163][164]
  • 9 November: The Delhi HC refuses bail to Karim Morani on health grounds, promising a ruling to the CBI on five other bail requests by 1 December.[165][166]
  • 11 November: Trial of the 17 accused begins in the Patiala House special CBI court.[167][168]
  • 14 November: The United Progressive Alliance government asks the SC to restrain Swamy from publicly accusing the UPA leadership, especially Home MinisterP Chidambaram and UPA chair Sonia Gandhi.[169][170]
  • 22 November: The special court moves the trial to the Tihar jail, after a Delhi high-court order.[171][172]
  • 23 November: The SC grants bail to five corporate executives: Sanjay Chandra of Unitech Wireless, Vinod Goenka of Swan Telecom and the Reliance Group's Gautam Doshi, Surendra Pipara and Hari Nayar.[173]
  • 28 November: The Delhi High Court grants bail to DMK MP Kanimozhi and four others: Karim Morani, Sharad Kumar, Asif Balwa and Rajeev Agarwal, upholding the principle of parity under Section 144 of the Constitution of India in a SC order.[174][175]
  • 29 November: The special court grants bail to Shahid Balwa, citing the principle of parity; the SC and HC had granted bail to 10 other accused parties.[176][177]
  • 1 December: The special court grants bail to Raja's former private secretary, R. K. Chandolia, ordering him not to visit the DoT without prior court permission.[178][179]
  • 2 December: Claiming suo motu, the HC stays trial-court bail granted to R. K. Chandolia.[180]
  • 7 December: The SC stays the HC's suo motu order against Chandolia's bail request.[181][182]
  • 8 December: The special CBI court accepts Swamy's request to summon Chidambaram as a witness and question two witnesses: senior CBI and Finance Ministry officials.[183][184]
  • 12 December: The CBI files a third chargesheet, naming Essar Group corporate promoters Ravi Ruia, his son Anshuman Ruia and its director of strategy and planning, Vikas Saraf, and Loop Telecom promoters Kiran Khaitan and her husband, I P Khaitan. It also charges Loop Mobile India, its subsidiary Loop Telecom and Essar Tele Holding.[185][186]
  • 16 December: The HC rejects the bail request of Siddharth Behura: "He was the 'perpetrator' of the illegal designs of Raja and would not claim benefit of parity with 10 others released on bail".[187]

2012[edit]

  • 2 February: The Supreme Court cancels the 122 licenses issued by Raja and imposes a ₹50 million ($1,018,122) fine on Unitech, Swan and Tata Teleservices and a ₹5 million fine on Loop Telecom Pvt Ltd, S-Tel, Allianz Infratech and Sistema Shyam Tele Services. The SC requested a trial-court ruling about whether Home Minister

The 2G spectrum scandal is turning out to be a multi-faced mystery with a new revelation surfacing every day. The latest shocker is the Finance Minister Pranab Mukherjee's note to the prime minister, which seeks to highlight that the current Home Minister P Chidambaram, who was the finance minister then, could have prevented the illegal 2G spectrum allocations. The scam was enormous to begin with; it is getting bigger with the role of top ministers emerging.

There are even hints that the prime minister's office was in the know of the illegalities but preferred to stay a mute spectator. This brings Prime Minister Manmohan Singh into the picture.

Firstpost gives you a quick recap of what the 2G case was really about, how it unfolded and who were the people initially implicated in the case.

The former telecomm minister, the man who started it all. Reuters.

The 2G spectrum licenses were announced in 2007 and according to the initial announcement made by the government, eight new companies were to be given telecom licences to start mobile services. The order to the effect stated that the allocation would be made on a 'first-come-first-served' basis. The licences were issued at the prices fixed in 2001 to keep tariffs low. The idea behind the policy was to provide cheaper services to the customers.

But the major loophole, a point which was exploited by the companies later, was the lack of clarity on the terms and conditions on the firms and their shareholding pattern. Some successful bidders availed their licenses at lower prices and then sold them off at huge profits. Some companies were suspected to be proxies popped up by bigger players. They sold a majority of their shares immediately after availing the licenses.

The flawed policy pointed to the complicity of the department of telecom itself. For instance, Swan Telecom bagged licence for 13 circles for Rs 1,537 crore and then offloaded 45 percent of shares to UAE based Etisalat for Rs 4,500 crore.

The loss to the exchequer was precisely because the policy ensured that while the initial bidders got the licenses at cheaper prices; they got away with selling these at huge profits. According to the estimate of the Comptroller and Auditor General (CAG) of India, the presumptive loss from the 2G scam was Rs 1.76 lakh crore. The latest speculation is that while the bidders were selling off their shares to foreign companies, those sales were actually overseen by the finance ministry at that time. This is precisely why Chidambaram is being implicated in the scam now.

People who've been implicated in the scam

Former telecom minister A Raja, who is believed to have pushed this rather flaky policy. In his defence Raja is stating that the allotment of spectrum was made on basis of recommendations by TRAI. Raja was arrested on 2 February, and charged with criminal conspiracy, cheating, abuse of office and forgery.

Siddhartha Behura, who was the secretary of the DoT then, has been charged with cheating and abuse of office.

RK Chandolia, who was the personal secretary of A Raja has been charged with cheating and abuse of office too.

On 8 February, the CBI also arrested Shahid Usman Balwa, Director of Swan Telecom Pvt Ltd, on charges of criminal conspiracy, cheating and forgery. Swan Telecom is believed to be front company for Anil Ambani's Reliance Communications. In March, Asif Balwa, brother of Shahid Balwa, and Rajiv Agarwal from Kusegaon Fruits & Vegetables Pvt Ltd, were arrestd by the CBI. Balwa is alleged to have paid a bribe of nearly Rs 214 crore to A Raja for allotting licenses at throwaway prices.

The bribe was paid through a circitous route which involved the Kusegaon Fruits and Vegetables Pvt Ltd company, Cineyug Films and Kalaignar Television in Chennai.

In April, the CBI followed it with arrests of Vinod Goenka, Director, Swan Telecom Pvt Ltd, for criminal conspiracy, cheating and forgery, and the partner of Shahid Balwa in DB Realty, which had floated Swan Telecom in the first place.

The other persons who were arrested in the case were Sanjay Chandra Director, Unitech, Gautam Doshi Group MD, Reliance ADAG, Hari Nair Company Secy, Reliance ADAG and Surendra Pipara Senior VP, Reliance ADAG charged with abetment to cheating, bribing government servants and forgery.

Kalaingar Television is owned by Karunanidhi's daughter Kanimozhi and his first wife Dayalu Ammal. While Kanimozhi was arrested when the CBI filed its second chargsheet, Dayalu Ammal was not because the CBI stated that she only speaks Tamil and thus could not be involved in the scam.

Kanimozhi, is charged with cheating, criminal conspiracy and accepting bribes. Along with her, Sharad Kumar the Managing Director of Kalaignar TV was also arrested on the same charges.

The 2G spectrum scam has thus revealed a major political and corporate nexus which ensured massive profits for those involved. As more details and the consequent name-calling goes on, it is clear that getting to the bottom of this scam is not going to be an easy task for the CBI.

For a complete look at our 2G scam coverage click here.


Published Date: Sep 28, 2011 16:27 PM | Updated Date: Nov 10, 2011 17:07 PM

Tags :#2g Scam#A Raja#Kanimozhi#Pranab Mukherjee#Reliance Communications#Shahid Usman Balwa#Swan Telecom Pvt Ltd

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