Even as the Centre on Thursday defended the telecom policy, the Supreme Court asked the Central Bureau of Investigation to examine how the UAE-based Etisalat was allowed to invest in Swan Telecom after the Union Home Ministry had expressed apprehensions on such Foreign Direct Investment (FDI) on the grounds of a threat to national security.
A Bench of Justices G.S. Singhvi and A.K. Ganguly wanted the CBI to examine this aspect, taking into consideration Janata Party president Subramanian Swamy's submissions that the Finance Ministry had written to Etisalat that its proposal for enhancing the FDI had been rejected by the Foreign Investment Promotion Board after the Home Ministry expressed its reservations.
The Bench was hearing petitions, filed by the Centre for Public Interest Litigation and Dr. Swamy, seeking the cancellation of 2G spectrum licences granted during the tenure of the former Telecommunications Minister, A. Raja.
The Bench also asked the CBI to examine the issue of the restoration of 2G spectrum licence to Chennai-based telecom operator S-Tel though its licence was earlier cancelled on the grounds of being a threat to national security. The Bench wanted to know whether S-Tel was coerced into dropping the petition challenging the withdrawal of its licence. It asked the CBI to respond by March 15, when the matter would be taken up again.
Attorney General G.E. Vahanvati defended the telecom policy that had been adopted since 1994 and said “spectrum was allocated on the basis of the policy decision which does not envisage its auction.”
He submitted that licences could not be cancelled solely on the grounds that the policy of auction was not followed. He said if there was any fault or gaps in the implementation of the policy, it was for the court to take a view on this. He made it clear that he would not deal with the administrative decisions taken by Mr. Raja.
He told the court that already a Joint Parliamentary Committee had been constituted, and the Public Accounts Committee was also looking into the issue of the spectrum allocation with respect to the Comptroller and Auditor General report. The CBI was probing the criminal aspect.
