Aircel-Maxis deal: SC stays transfer, sale of spectrum

A view of Supreme Court in New Delhi.   | Photo Credit: V. Sudershan

Showing zero tolerance to those who exploit precious natural resources and then try to outmaneuvre the country's judicial process, the Supreme Court on Friday stayed all transfer and sale by Malaysia-based Maxis group of companies of 2G spectrum originally allocated to Aircel in November 2006.

A three-judge Bench, headed by Chief Justice of India J.S. Khehar, then gave Maxis's controlling owner, Ananda Krishna Tatparanandam, and three others a two-week deadline to appear in court. The Bench observed that it was "open" to them to enter appearance in the Supreme Court.


Besides Mr. Krishna, the other three are M/s. Astro All Asia Networks Limited, M/s. Maxis Communications and Augustus Ralph Marshall, a director in Maxis and Astro. All four face charges in a case linked to the multi-crore 2G spectrum corruption scam, which is under trial before a Special CBI Court in Delhi.


These four were among eight named by the CBI in its charge sheet filed on August 29, 2014. They had not bothered to comply with repeated summons from the CBI court over the years.

To compel the appearance of the accused in court, the Bench proposed to pass a restraint order against the accused from earning revenue from the use of their allocated 2G spectrum in case of they did not turn up in court within the next fortnight.

"We cannot tolerate a person using rare national resources like spectrum and not honouring the court's notice," Chief Justice Khehar observed.

The Bench asked the Telecom Ministry to work out the modalities in case the restraint order is enforced, besides ensuring provisional arrangements for Aircel subscribers to get uninterrupted services from some other network provider.

The Bench proposed that in case the accused chose not to appear in court, no monetary claims for the loss of its allotted 2G spectrum would be entertained.

“It is imperative to ensure, in our considered view, that the process of law should not be permitted to be frustrated by non-service of summons on the accused,” the six-page order of the Bench explained.

The court asked the government to publish its order in two leading newspapers of Malaysia so that Maxis and others are officially apprised of the mandate.

The Bench posted the hearing on February 3.

The apex court order is based on an application by NGO Centre for Public Interest Litigation (CPIL) to order the CBI and the Enforcement Directorate to prevent Aircel-Maxis from “attempting to quickly sell off its allotted spectrum, which is a precious natural resource belonging to the people of India, to Bharti Airtel and Reliance Communications for thousands of crores, and exit the market with huge sums of money”.

The CPIL, which was a petitioner in the legal battle concerning the 2G spectrum scam before the Supreme Court, submitted that “if the deal between Aircel and Bharti Airtel and the deal between Aircel and Reliance Communications are allowed to go through, then that would allow Maxis to escape the arm of law and abscond with thousands of crores of money”.

According to the FIR registered by the CBI, Sivasankaran (who had originally sought spectrum licence) was forced to sell Aircel. In March 2006, the Maxis group bought 74 per cent stake in Aircel. The company got FIPB approval in May 2006.

In November 2006, the Department of Telecommunications issued to Aircel 14 Letters of Intent, all of which were converted into licences in December 2006. Within three months of this development, Sun Direct received substantial investment from the Maxis Group (Aircel), which took 20 per cent equity. The FIPB approved this investment on March 2 and 19, 2007. The Maxis group invested a total of Rs 599.01 crore in Sun Direct between December 2007 and December 2009.

Corrections & Clarifications: This article has been edited for a factual error.

This article is closed for comments.
Please Email the Editor

Printable version | Oct 21, 2020 6:55:42 PM |

Next Story