The executives of India’s top companies, including Reliance Communications (RCom) Chairman Anil Ambani, appeared before Parliament’s Public Accounts Committee (PAC) on Tuesday to explain their role in the 2G spectrum allocation scam.
During the two-hour questioning, beginning 1 pm, Ambani said the Central Bureau of Investigation (CBI) had already chargesheeted the company and excused himself from detailed answers on a few occasions on the ground that the case was sub judice.
He was questioned about both the allocation of 2G spectrum and the 3G auction held last year. While he justified the “first come, first served” policy for allocating 2G spectrum in 2008, he reportedly favoured the auction route for 3G spectrum.
“He was very free and frank,” said a PAC member. “He was candid, courteous and confident,” said another.
However, for the members of Parliament (MPs), it was the session with DB Realty Managing Director Vinod Goenka that was the most illuminating. Goenka was asked how the company managed to arrange a bank draft of Rs 50 crore and deposit it at Sanchar Bhawan within 45 minutes of the policy being announced.
To this, Goenka said as the draft was drawn on a Delhi bank, it was easy. At this, BJP MP Yashwant Sinha pulled out a few papers from his file and said: “We have a copy of the draft and it shows that it was made at a PNB branch in Mumbai. How did you manage to get the draft from Mumbai to Delhi in 45 minutes?”
Goenka replied, “I will get back to you, sir.”
CBI and the Comtroller and Auditor General (CAG) allege that DB Realty owns a substantial stake in Swan Telecom, which paid Rs 1,537 crore for the 2G licence. This Rs 50 crore was one of the demand drafts submitted by the company on January 10, 2008.
Ambani was questioned extensively on his group’s links with Swan Telecom. Both CBI and CAG believe Swan was a front for the Anil Dhirubhai Ambani Group (ADAG) to circumvent the rule that a telecom operator cannot hold more than 10 per cent stake in another operator in the same circle.
When asked why he took so much interest and invested Rs 9,000 crore in Swan’s redeemable preferance shares, Ambani said, “I got back the money.” He said it made “good business sense” as Swan was to have used ADAG’s infrastructure. “Ultimately, I would have benefitted,” he said.
Asked how he was ready with a demand draft of Rs 1,651 crore on the very day the Department of Telecommunications allowed a licence-holder to use both GSM and CDMA technologies, Ambani said, “It was all in the media.”
Ambani also claimed that he felt victimised as ADAG had to wait for 18 months to get a licence for GSM services while others got it much earlier.
Like Tata Chairman Ratan Tata, he said the 2G spectrum allocation had caused no real loss to the exchequer.
Etisalat DB Telecom CEO Atul Jhamb, S-Tel Executive Director V Srinivas, Charles Woodworth of Telenor Asia Pvt Ltd and Uninor Chairman Sanjay Chandra also deposed before the PAC and denied any wrongdoing.
The PAC asked Jhamb if he was aware that ADAG had a 10.71 per cent stake in Swan. He replied, “No, it was 9.7 per cent.” This is contrary to what the CBI charge sheet and the CAG report mention.
CBI on Saturday charged ADAG and the Indian partners of Telenor and Etisalat with wrongfully getting 2G licences and spectrum in 2008. Top Swan officials have been charged with conspiring with former telecom minister A Raja to get mobile licences.
The charge sheet also names Swan’s Shahid Balwa and Vinod Goenka, adding that Swan was a front for Reliance Telecom, an ADAG company, when it got mobile permits.
Jhamb told the committee that Shahid Balwa, who is in CBI custody, was a partner.
Meanwhile, in the Supreme Court, the government on Tuesday objected to CBI’s decision to appoint senior advocate U U Lalit as a special public prosecutor.
Attorney General G E Vahanvati told a Bench of Justice G S Singhvi and Justice A K Ganguly that under the Prevention of Money Laundering Act, a special public prosecutor should have been working with a state or the Union government for at least seven years.
Vahanvati sought time till Friday to find out if Lalit fit the bill. He said this technical issue could lead to the collapse of the public prosecutor’s case.
CBI counsel KK Venugopal said the agency was facing a difficulty in finding a prosecutor as most available senior counsels had been hired by one or the other party to the case.
Maintaining that Lalit was the best choice under the given circumstances, Venugopal said he had a vast experience in criminal law. This is the first time the government has questioned the professional credentials of a prosecutor hired by CBI.
