Lok Sabha Question No. 4073 (UNSTARRED), answered on 2016-08-10
Subject: 2G Investigation
Ministry: COMMUNICATIONS
Asked by: PASHUPATI NATH SINGH

## GOVERNMENT OF INDIA MINISTRY OF COMMUNICATIONS DEPARTMENT OF TELECOMMUNICATIONS

## LOK SABHA UNSTARRED QUESTION NO.4073 TO BE ANSWERED ON 10 TH   AUGUST, 2016

## 2G INVESTIGATION

†4073. SHRI PASHUPATI NATH SINGH:

Will the Minister of COMMUNICATIONS be pleased to state:

- (a) whether the investigation on 2G spectrum scam has been completed;
- (b) if so, the outcome thereof and the action taken in this regard; and
- (c) if not, the present status of the investigation?

## ANSWER

## THE MINISTER OF STATE (IC) OF THE MINISTRY OF COMMUNICATIONS & MINISTER OF STATE IN THE MINISTRY OF RAILWAYS (SHRI MANOJ SINHA)

- (a) Most of the investigations in 2G spectrum scam have been completed . Further investigations on certain points are underway by Central Bureau of Investigation (CBI) and Enforcement Directorate (ED).
- (b) & (c) The  allotment  of  second  generation  (2G)  telecom  spectrum  license  was  referred  to  the Central  Bureau  of  Investigation  (CBI)  by  the  Central  Vigilance  Commission  (CVC)  on  12-10-2009  for further probe. Investigation into 2G spectrum scam is being directly monitored by the Hon'ble Supreme Court of India.

The Central Bureau of Investigation (CBI) registered total three Regular Cases bearing Nos. RCDAI-2009-A-0045, RC-DAI-2011-A-0022, RC-DAI-2011-A-0024 and  two Preliminary Enquiries Nos. PEDAI-2011-A-0001  &  PE-BDI-2010-E-0002      with  regard  to  2G  Spectrum  matters.  A  detailed  note containing the present status of above mentioned cases/PEs (Preliminary Enquiry) is at Annexure .

The Enforcement Directorate (ED) is investigating the offences in 2G spectrum case under the provisions  of  Prevention  of  Money  Laundering Act,  2002  (PMLA)  and Foreign  Exchange Management Act, 1999 (FEMA).  On the basis of investigation conducted so far, assets worth Rs. 966.13 Crore have been  attached  under  Prevention  of  Money  Laundering  Act  (PMLA).  Further  proceedings  in  respect  of attachment have been stayed by the Hon'ble Supreme Court of India. Two Prosecution Complaints have been filed before the Special Court of PMLA under section 45 of the PMLA. 12 Letters of Request (LRs) have been sent outside India for collection of evidence. Response of some of the LRs is still awaited. Further,  16  Show  Cause  Notices  (SCNS)  amounting  to  Rs.  13974.34  Crore  under  FEMA  have  been issued for various contraventions against various entities.

Status report submitted by Central Bureau of Investigation (CBI) in   2G spectrum cases

## A) RC-DAI-2009-A-0045

On  receipt  of  the  Central  Vigilance  Commission  (CVC)  report,  and  on  the  basis  of  source information,  Central  Bureau  of  Investigation  (CBI)  registered  a  case  on  21.10.2009  for  criminal conspiracy  and  criminal  misconduct  against  unknown  officials  of  Department  of  Telecommunications, Govt.  of  India,  unknown  private  persons/companies  and  others  u/s  120-B  IPC,  13(2)  r/w  13(1)(d)  of Prevention of Corruption Act, 1988.

Investigation into the main offence was concluded which revealed commission of offences, during 2007-09, punishable u/s 120-B, 420, 468, 471 of IPC and also punishable u/s 13 (2) r/w 13 (1) (d) of Prevention of corruption Act 1988 against accused persons, viz. S/Sh A Raja, then MOC&IT; Siddhartha Behura, then secretary (Telecom); R.K. Chandolia, then PS to MOC&IT; Shahid Usman Balwa, Director, M/s Swan Telecom Pvt. Ltd., Vinod Goenka, Director, M/s Swan Telecom Pvt. Ltd.; M/s Swan Telecom Pvt. Ltd. (now Etisalat DB Telecom Pvt Ltd) through its Director; Sanjay Chandra, Managing Director of M/s Unitech Ltd.; M/s Unitech Wireless (Tamil Nadu) Private Ltd through its Director; Sh. Gautam Doshi, Group Managing Director, Reliance ADA Group; Sh. Hari Nair, Senior Vice President of Reliance ADA Group; Sh. Surendra Pipara, Senior Vice President of Reliance ADA Group & M/s Reliance Telecom Ltd. through its Director.

Accordingly, a charge sheet against the aforesaid persons / companies was filed before the court of Special Judge (2G spectrum Cases), New Delhi on 02.04.2011.

## FIRST SUPPLEMENTARY CHARGE-SHEET

Subsequently the allegations regarding quid pro quo / suspected illegal gratification of around Rs. 200 crores paid by M/s Dynamix Realty (a DB Group company which also promotes / owns M/s Swan Telecom Pvt. Ltd.) to Sh. A Raja, then MOC&IT through M/s Kalaignar TV Pvt. Ltd., following a circuitous route  through  M/s  Kusegaon Fruits  &  Vegetables Pvt.  Ltd.  and  M/s  Cineyug  Films  Pvt.  Ltd.,  was  also further investigated.

The investigation disclosed that the amount of Rs. 200 Crores paid by M/s Dynamix Realty to M/s Kalaignar TV Pvt. Ltd, through M/s Kusegaon Fruits & Vegetables Pvt. Ltd. And M/s Cineyug Films Pvt. Ltd.,  was not a genuine business transaction but in the nature of illegal gratification paid in lieu of the UAS Licences, valuable spectrum and  other undue benefits shown by accused public servants to M/s Swan Telecom Pvt. Ltd. Accordingly, in the addition to the offences charge by CBI against the accused persons  in  the  main  charge-sheet  dated  02.04.2011,  accused  persons  viz.  A  Raja,  Ms.  Kanimozhi Karunanithi, Sharad Kumar, Shahid Balwa, Vinod Goenka, Asif Balwa, Rajiv Agarwal and Karim Morani were  charge-sheeted  vide  a  supplementary  charge  sheet  dated  25.04.2011,  for  offences  punishable under section 120-B IPC read with section 7 (alternatively section 11) & 12 of PC Act, 1988.

The Ld. Special Judge, New Delhi took cognizance of the aforesaid charge-sheet and clubbed the same with main charge sheet. Prosecution & Defence evidence in the case have been concluded and now, the case is at the stage of final arguments on behalf of the defense.

## LOOP TELECOM - ESSAR MATTER

As regards the investigation into the offence relating to alleged cheating by suppression of the violation  of  Clause  No.  8  i.e.  substantial  Equity  Clause  of  Unified  Access  Service  License  (UASL) Guidelines  dated  14.12.2005  issued  by  the  Department  of  Telecommunications  (DoT),  by  suspected persons  /  companies  belonging  to  M/s  Loop  Telecom  /  Essar  group  was  concluded.  Investigation regarding the role of public servants in the matter of not issuing Show Cause Notice to M/s Loop Telecom Pvt. Ltd. even after having prima facie allegation of violation of said clause 8 of UASL guidelines, was also conducted.

After  completion  of  investigation  in  RC-DAI-2009-A-0045  regarding  Loop  Essar  matter,  second supplementary charge sheet was filed in the court of special Judge (2G spectrum Cases) on 12.12.2011 for the offences punishable u/s 120-B IPC r/w 420 of IPC against accused Ravi N. Ruia, Anshuman Ruia, Vikash Saraf, I.P. Khaitan, Ms. Kiran Khaitan, M/s Loop Telecom Ltd. (erstwhile M/s Shippingstop Dot Com India Pvt. Ltd.), M/s Loop Telecom Ltd. (erstwhile M/s BPL Mobile Communications Limited) and M/s Essar Teleholding Ltd.

Final  arguments  in  the  case  have  been  concluded  both  by  the  prosecution  and  the  defense. Rebuttal  of  the  final  arguments  by  Prosecution  has  also  been  complete  .Now  the  case  is  fixed  for clarification/rebuttal by the defense.

## Pending Investigation /Further Investigation

- (i) Further  investigation  in  India  on  certain  points  related  to  LRs  of  M/s  Unitech,  is  at  final stage. However,  further investigation at Mauritius etc. is pending  for which  LRs/ Supplementary LRs have been issued.
- (ii)       It  is  to  further  mention  that  IA  No.  72/2014  in  Civil  Appeal  No.10660/2010,  was filed  on 10.03.2014 by the Centre for Public interest Litigation & Ors., before the Hon'ble supreme court of India. In response to the aforesaid IA, the then director, CBI reviewed the matter and ordered to further investigate the aforesaid case on the issue of roll out obligation / dual technology, in respect of TTSL / TTML etc. The further investigation in this matter is at final stage.

## B)  Preliminary Enquiry no. PE DAI 2011 A 0001 dated 04.01.2011

The PE (Preliminary Enquiry)  was  registered to  enquire  into  the  irregularities  committed  in  the grant of licenses & spectrum for Cellular Mobile Telephone service/Basic (Telephone) services / Unified access Service by the Department of Telecommunications from 2001 to 2007, with particular emphasis on the loss caused to the public exchequer and corresponding gain to the licensees/service providers. The enquiry covered the allocation of licenses / spectrum during various periods i.e. period 2001-2003 (MOC&IT - Late Pramod Mahajan), 2003-04 (MOC&IT - Sh Arun Shourie) and 2004-07 (MOC&IT - Sh Dayanidhi Maran). As regards, the period 2003-04, no major issue or irregularity has been found during the  enquiry.  Accordingly,  a  Self-Contained  Note  was  forwarded  to  Department  of Telecommunications and Telecom Regulatory authority of India for taking such action as deemed fit. However, following two regular Cases were registered on the basis of the outcome of this Preliminary enquiry.

- (i) RC-DAI-2011-A-0022:, The case was registered by CBI on 9.10.2011 u/s 120-b of IPC r/w Section 13(2) r/w 13(1)(d) of PC act, 1988 and Sections 7 & 12 of PC Act, 1988 against Sh. Dayanidhi Maran, the then Minister of Communications and Information Technology, Govt. of India and others. After completion of investigation of this case, a charge sheet was filed on 29.08.2014 u/s. 120-B IPC r/w 7, 12 and 13(2) r/w 13(1)(d) of PC Act, 1988, in the court of Ld. Special Judge 2G Spectrum Cases, against Sh. Dayanidhi Maran, the then MoC&IT and others. The further investigation on some issues is continuing in this case. The trial of the case is fixed in the court for appearance of the remaining 4 Malaysian accused persons.
- (ii) RC-DAI-2011-A-0024: The case was registered by CBI on 17.11.2011 u/s 120-b of Indian Penal Code r/w Section 13(2) r/w 13(1)(d) of PC Act, 1988 against Sh. Shyamal Ghosh, the then Chairman (TC) & Secretary (Telecom), Department of Telecommunications and others. After completion of the investigation a charge sheet was filed in this case on 21.12.2012 in the court of Ld. Special Judge for 2G Spectrum cases, u/s 120-B of IPC r/w Sec 13(2) r/w 13(1)(d) of PC Act, 1988 and substantive offences thereof against Sh. Shyamal Ghosh and others.  The  Hon'ble  Trial  court  took  cognizance  of  the  case  on  19.03.2013  and  later discharged  all  the  accused  persons  vide  its  order  dated  15.10.2015.The  order  is  under examination in CBI on whether it needs to be challenged in the appellate court.

## C) Preliminary Enquiry no. PE BDI 2010 E 0002

The  aforesaid  Preliminary  Enquiry  (PE)  was  registered  on  23.12.2010  for  enquiry  into  the allegation of grant of huge loans by the public sector and other banks to some of the companies which have  succeeded  in  obtaining  licences  in  2008  and  find  out  whether  the  officers  of  the  DoT  were signatories to the loan agreement executed by the private companies and if so, why. Detailed enquiry about such loans to all telecom companies, which got licenses in 2008, was conducted by the Banking securities  &  Fraud  Cell  of  CBI,  New  Delhi  and  no  major  irregularity  or  criminality  was  prima  facie revealed.

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