The former Communications and IT Minister, A. Raja, manipulated the powerful Telecom Commission, the Department of Telecom's decision-making body, to favour companies in granting 2G licences in 2008, the draft Public Accounts Committee (PAC) report on 2G scam has said.

It also pointed out that how the DoT under Mr. Raja bypassed the Telecom Regulatory Authority of India (TRAI) on important issues, particularly that relating to grant of new licences.

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The PAC noted that as per the Rules of Business of the Telecom Commission, matters of policy relating to telecommunications and proposals for acceptance of any rules and procedures which involve significant deviations from normal rules and procedures of the government are to be brought before the Commission. However, the TRAI's recommendations of 2007, which were very crucial from the perspective of the management of the telecom sector and spectrum management, were never placed before the Commission.

To make the Commission virtually defunct, the report said, an artificial and convenient division has been created by inclusion of full-time and part-time members of the Commission. Pointing out that the Finance Ministry was bypassed while taking decisions related to spectrum pricing, the report said: “Prevalent practice has been developed in the DoT as a camouflage to take very convenient decisions through the permanent internal members of the DoT and avoid uncomfortable decisions in the entire Telecom Commission, where the part-time but independent members, particularly the Finance Secretary, would be raising objections.”

“The Committee strongly disapproves [of] such a dubious practice and impresses upon them to henceforth discard distinguishing between the full-time and part-time members or for that matter between internal or full Telecom Commission as the Commission is one entity,” the report said. The Committee has asked the government to revisit the ‘Transaction of the Business Rules' of the Commission with a view to revising the quorum rule making the presence of the Finance Secretary, or his authorised representative not below the rank of Joint Secretary in the Department of Economic Affairs, as an essential condition for constituting the quorum.

The PAC also found serious faults in the functioning of the TRAI. Though the TRAI's recommendations are not binding upon the Centre, it is mandatory for the government to seek its recommendation in matters pertaining to the need and timing for introduction of new service providers.

“But the Committee is surprised to note that while seeking the TRAI's recommendation on April 13, 2007 on various issues, the DoT did not seek recommendations on grant of new licences despite the mandatory requirement. Even though the decision of the government is final whether to accept or reject the TRAI's recommendation, not seeking such recommendations at all speaks volumes for the DoT's malafide designs to circumvent the established provisions in the TRAI Act,” it added.

Pointing out that the TRAI's flip-flop in its recommendations contributed towards the DoT, under Mr. Raja, taking arbitrary and unilateral decisions, the PAC has recommended that “the TRAI should reflect deeply and dispassionately mindful of the far-reaching implications of their recommendation so that there is no scope for second interpretation or the so-called cherry-picking.”

TRAI criticised

Criticising the TRAI for not exercising its suo motu powers when the first-come-first-served (FCFS) basis for granting licence was arbitrarily adopted by the DoT, the PAC report said the TRAI's explanation that it never recommended the FCFS criteria was again an indicator of its ambiguous stance on important matters, which was “worse than dereliction of duty.”

“The Committee considers it the TRAI's moral obligation to take such steps because its advocacy of no auction of 2G Spectrum led to the adoption of the FCFS method which subsequently resulted in the allotment of spectrum at a throw away price,” the report added.

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