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CBI today told a special court that Essar Group was "effectively controlling" Loop Telecom Limited (LTL) which had "fraudulently and dishonestly" misrepresented facts before Department of Telecommunications (DoT) to acquire 2G spectrum licences.
The agency argued that the entire funding in this case was by Essar Group of companies and restructuring of firms was done to conceal the fact that the Group was controlling LTL.
Advancing final arguments in the case in which promoters of Essar Group, Loop Telecom Ltd and others are facing trial, special public prosecutor Anand Grover said that "fraudulent misrepresentation" by LTL before the DoT constituted alleged offence punishable under section 420 (cheating) of the IPC.
"There are series of transactions which shows that before, after and during the conspiracy, Loop Telecom was controlled by Essar Tele Holding Ltd (ETHL). They (LTL) fraudulently and dishonestly misrepresented the fact before DoT to get the 2G spectrum licences," Grover told Special CBI Judge O P Saini.
He also said that clause 8 of the Unified Access Services Licences (UASL) guidelines was also violated by accused firm.
As per clause 8 of UASL guidelines, "No single company or legal person, either directly or through its associates, shall have 10 per cent or more equity holding in more than one licensee company in the same service area for same service."
"From December 2007 to January 2008, clause 8 certificate was repeatedly submitted by LTL in the DoT... Restructuring of companies was done to conceal the fact that Essar Group was controlling LTL," Grover said.
He also argued that various "sham transactions" took place in the entire process.
Grover concluded his arguments today after which the court fixed the matter for September 21 for hearing final arguments of the defence counsel.
Essar Group promoters Ravi Ruia and Anshuman Ruia, Loop Telecom promoters, Kiran Khaitan, her husband I P Khaitan and Essar Group Director (Strategy and Planning) Vikash Saraf are facing trial in the case, along with three telecom firms -- LTL, Loop Mobile India Ltd and ETHL.
The five individuals accused, who are out on bail, have denied the charges levelled by CBI.
