SC axes 122 telecom licences
Delivering a body blow to the government, the Supreme Court on Thursday cancelled 122 2G licences granted during the tenure of former communications minister A. Raja. The court declared the grant of licences “illegal” and blamed the government for its “flawed first-come-first-served policy”. A two-judge bench of Justices G.S. Singhvi and A.K. Ganguly allowed the impugned licences to run for four months, after which the cancellation order becomes operative.
The order was issued on a petition filed by CPIL, an NGO, and Janata Party president Subramanian Swamy alleging a scam in spectrum allocations by Mr Raja in January 2008 during the first UPA government. The Comptroller and Auditor-General had calculated a presumptive loss to the exchequer of upto `1.76 lakh crore.
Union home minister P. Chidambaram got a temporary reprieve with the Supreme Court referring the question of whether he should be made an accused back to the trial court. Disposing of Mr Swamy’s petition, the bench said the trial court should decide this within two weeks. It is, however, expected to come up there on February 4.
Rejecting a petition to set up a SIT to probe the 2G scam, the Supreme Court directed the central vigilance commissioner monitor investigations by the CBI and other agencies. All these agencies must now submit their status reports to the CVC, which will then forward its recommendations to the Supreme Court. Prime Minister Manmohan Singh held consultations with the home minister and communications minister Kapil Sibal on Thursday evening following the court’s order.
Observing that the allocation by Mr Raja was “wholly arbitrary and unconstitutional”, the court imposed a penalty of `5 crores on Etisalat DB Telecom (Swan Telecom), Unitech Wireless Group and Tata Teleservices. It also ordered Loop Telecom, S-Tel, Allianz Infratech and Sistema Shyam TeleServices to pay costs of `50 lakhs each. It said these companies benefited by the “wholly arbitrary and unconstitutional action of award of licences to them and for offloading their stakes for many thousand crores in the name of fresh infusion of equity or transfer of equity”.
The bench, pointing out serious lapses by the department of telecom, indicted the DoT and Mr Raja for not heeding the Prime Minister’s advice that “transparency” and “fairness” be adopted while allocating scarce spectrum. Criticising Trai’s role, the court said the “regulator’s approach was lopsided, and contrary to the decision by the council of ministers”. It said Trai’s recommendations became a “handle” for Mr Raja to “gift” an “important national asset at throwaway prices”.
The bench also said that the earlier NDA government’s telecom policy was “not a sound one” and had “fundamental flaws”.
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