A local court will take up for cognisance tomorrow the charge sheet in the allocation of additional spectrum during the NDA regime with CBI saying the then government’s decision had “brightened” the outcome of the IPO of one Bharti Airtel’s group companies.
The charge sheet has named three telecom firms - Bharti Cellular Ltd, Hutchison Max Pvt Ltd (now known as Vodafone India Ltd) and Sterling Cellular Ltd (now known as Vodafone Mobile Service Ltd) - as accused in the case in which the Department of Telecommunication (DoT) had allegedly allocated the additional spectrum resulting in the loss of Rs 846 crore to the exchequer.
“Investigation has thus established that during the pendency of the aforesaid period of said IPO (Initial Public Offer) of M/s Bharti Tele-Ventures Ltd, Late Pramod Mahajan, then MOC&IT, took decision on January 31, 2002 for allocating additional spectrum between 6.2 MHz upto 10 MHz (paired) in conspiracy with accused Shyamal Ghosh and the said three accused telecom companies and on the basis of recommendation of Shyamal Ghosh.
“The IPO of the said company (Bharti Tele-Ventures Ltd) was closed on February 2, 2002 and, therefore, by getting the said approval for additional spectrum and by getting such news published in the newspaper, the risk factor of additional spectrum as mentioned in draft prospectus had been mitigated and brightened the outcome of the said IPO,” the charge sheet said.
In the charge sheet filed against three telecom companies, including Bharti Airtel and Vodafone India, CBI has said that during the pendency of IPO of M/s Bharti Tele-Ventures Ltd, a Bharti Group company, decision in this regard was taken by then Telecom Minister Late Pramod Mahajan, who was not named as accused as he is no more.
The charge sheet, filed before Special CBI judge O.P.Saini, on December 21 last year, has named former Telecom Secretary Shyamal Ghosh as an accused.
In the 57-page charge sheet, the CBI has booked all the accused for the offences of criminal conspiracy (120-B) of the IPC and under provisions of the Prevention of Corruption Act.
Giving details of the IPO, it said Bharti Tele-Ventures Ltd had issued an IPO on January 28, 2002 and it was closed on February 2, 2002.
It said while seeking approvals for the IPO, the company had filed Draft Red Herring prospectus with Securities and Exchange Board of India (SEBI) and different stock exchanges.
The CBI said in their draft prospectus, it had “mentioned that the expansion and development of their network might be impacted by the limited availability of frequency spectrum which was mentioned as one of the risk factors“.
It said the decision regarding allocation of additional spectrum to these telecom firms was taken on January 31, 2002 in “undue haste” in pursuance to the criminal conspiracy hatched amongst Mahajan, Ghosh and these telecom companies.
Detailing the sequence of events relating to the IPO, the CBI said the approval for additional spectrum boosted the investment in the shares of the company through the IPO.
“It thereby proved to boost and encouraging factor for the investors to invest in the shares of the said company through said IPO,” it said, adding, “Investigation also revealed that substantial number of share applications were received on February 1, 2002 and February 2, 2002 immediately after the said decision dated January 31, 2002 taken for allotment of additional spectrum...”
Regarding the alleged conspiracy hatched among all the accused, it said, “Investigation has also revealed that various directors/promoters/representatives of the said three accused telecom companies had been meeting the accused public servants in connection with getting allocation of additional spectrum, for which said accused companies had not yet achieved the subscribers base as recommended by the Technical committee of the DoT.”
The CBI has not named Jagdish Rai Gupta, a former Deputy Director General (VAS) cell of DoT and a former Director of BSNL, who was named in the FIR, as accused in the case saying, .
“no evidence attributing any criminality on his part or his involvement in the alleged offence has surfaced during the investigation.”
Regarding Ghosh, the agency has said that in conspiracy with Mahajan and accused telecom firms, he abused his official position to show undue favour to the companies causing a loss of Rs 846.44 crore to the exchequer.