2G spectrum scam

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The 2G spectrum scam involved politicians and government officials in India illegally
undercharging mobile telephony companies for frequency allocation licenses, which they would
then use to create 2G subscriptions for cell phones. The shortfall between the money collected
and the money which the law mandated to be collected is estimated to be 176,645 crore
(US$32.15 billion), as valued by the Comptroller and Auditor General of India based on 3G and
BWA spectrum auction prices in 2010.[1] However, the exact loss is disputed. In a chargesheet
filed on 2 April 2011 by the investigating agency, Central Bureau of Investigation (CBI), the loss
was pegged at 30,984.55 crore (US$5.64 billion)[2] whereas on 19 August 2011 in a reply to
CBI, Telecom Regulatory Authority of India (TRAI) said that the govt gained over 3,000 crore
(US$546 million) by giving 2G Spectrum.[2] Similarly Kapil Sibal, the Minister of
communications & IT, claimed in 2011, during a press conference, that "zero loss" was caused
by distributing 2G licenses on first-come-first-served basis.[3]

All the speculations of profit, loss and no-loss were put to rest on 2 February 2012 when the
Supreme Court of India delivered judgement on a public interest litigation (PIL) which was
directly related to the 2G spectrum scam. The Supreme Court declared allotment of spectrum as
"unconstitutional and arbitrary," and quashed all the 122 licenses issued in 2008 during tenure
of A. Raja (then minister for communications & IT) the main official accused in the 2G scam
case.[4] The court further said that A. Raja "wanted to favour some companies at the cost of the
public exchequer" and "virtually gifted away important national asset."[5] The "zero loss theory"
was further demolished[6] on 3 August 2012 when as per the directions of the Supreme Court,
Govt of India revised the base price for 5 MHz 2G spectrum auction to 14,000 crore (US$2.55
billion), which roughly gives the value of spectrum to be around 2,800 crore (US$509.6
million) per MHz that is close to the CAG's estimate of 3,350 crore (US$609.7 million) per
MHz.[7][8]

The original plan for awarding licences was to follow a first-come-first-served policy to
applicants. A. Raja manipulated the rules so that the first-come-first-served policy would kick in
- not on the basis of who applied first for a license, but who complied with the conditions.[9] On
10 January 2008, companies were given just a few hours to provide their Letters of Intent and
cheques. Those allegedly tipped off by Mr Raja were waiting with their cheques and other
documents. Some of their executives were sent to jail along with the Minister himself.[9]

In 2011, Time magazine listed the scam at number two on their “Top 10 Abuses of Power” list
(just behind the Watergate scandal).[10][11][12]

Contents
 1 Background
 2 Parties accused of involvement
 o 2.1 Politicians accused

o 2.2 Bureaucrats accused

o 2.3 Corporate executives accused

o 2.4 Film and entertainment persons accused

o 2.5 Corporations accused

o 2.6 Media persons' dubious role

 3 Chronology of events and investigation

o 3.1 2007

o 3.2 2008

o 3.3 2009

o 3.4 2010

o 3.5 2011

o 3.6 2012

 4 Licenses quashed
o 4.1 Telecom companies affected by cancellation of licenses

o 4.2 Aftereffects of Supreme Court's verdict

 5 Aircel-Maxis deal controversy

 6 Response to scam
 7 See also
 8 External links

 9 References

Background
India is divided into 22 telecom zones, with a total of 281 zonal licenses in the market.[13]
According to the telecom policy of India, when a licence is allotted to an operator, some start-up
spectrum is bundled along with it.[14] The policy does not have a provision for auctioning the
spectrum.[15] In 2008, 122 new second generation (2G) Unified Access Service (UAS) licenses
were given to telecom companies at the 2001 price and on a first-come-first-serve basis. As per
the chargesheet filed by the Central Bureau of Investigation (CBI), several rules were violated
and bribes were paid to favour certain firms while awarding 2G spectrum licenses. The audit
report of Comptroller and Auditor General of India (CAG) says that several licenses were issued
to firms with no prior experience in the telecom sector or were ineligible or had suppressed
relevant facts.[16] In November 2007 Prime Minister of India Dr Manmohan Singh had written a
letter to telecom minister A. Raja directing him to ensure allotment of 2G spectrum in a fair and
transparent manner and to ensure license fee was properly revised. Raja wrote back to the Prime
Minister rejecting many of his recommendations.[17] In the same month Ministry of Finance
wrote a letter to Department of Telecommunications (DOT) raising concerns over the procedure
adopted by it[17] but DOT went ahead with its plan of giving 2G licenses. It preponed the cut-off
date to 25 September, from 1 October 2007.[17] Later on the same day, DoT posted an
announcement on its website saying those who apply between 3.30 and 4.30 pm on that very day
would be issued licences in accordance with the said policy.[17] Companies like Unitech & Swan
Telecom got licenses without any prior telecom experience.[15] Swan Telecom got the license
even though it did not meet eligibility criteria.[15] Swan got license for 1,537 crore (US$279.73
million) and then it sold 45% stake to UAE based company Etisalat for 4,200 crore (US$764.4
million).[15] Unitech Wireless, a subsidiary of the Unitech Group, got license for 1,661 crore
(US$302.3 million) and later sold 60% stake for 6,200 crore (US$1.13 billion) to Norway based
company Telenor.[15]

Following is the list of companies who received 2G licenses during the tenure of A. Raja as
Telecom Minister.[18][19] (The licenses were later quashed by Supreme Court)[20][21]

Telecom regions for Number

Name of
which license was of license Remarks
Company
granted granted

Haryana, Himachal Adonis Projects, Nahan Properties,

Pradesh, Jammu & Aska Projects, Volga Properties,
Adonis Projects
Kashmir, Punjab, 6 Azare Properties & Hudson
Pvt. Ltd.
Rajasthan, Uttar Pradesh Properties were acquired by Unitech.
(East) Unitech Infrastructure and Unitech
Builders & Estates were already
Assam, Bihar, North East, subsidiaries of Unitech Group. So in
Nahan Properties
Orissa, Uttar Pradesh 6 2008 Unitech had 22 2G licenses.
Pvt. Ltd.
(East), West Bengal Later in the same year Norway
based company Telenor bought
Aska Projects Andhra Pradesh, Kerala,
3 majority stake in the telecom
Ltd. Karnataka
company from the Unitech Group.
Volga Properties Gujarat, Madhya Pradesh, Now it offers services under Uninor
3 brand holding 22 pan India licences.
Pvt. Ltd. Maharashtra

Azure Properties
Kolkata 1
Ltd.

Hudson Delhi 1
Properties
Unitech Builders
Tamil Nadu (including
& Estates Pvt. 1
Chennai)
Ltd.

Unitech
Infrastructures Mumbai 1
Pvt. Ltd.

Bihar, Gujarat, Himachal,

Pradesh, Kerala, Kolkata,
Punjab, Rajasthan, Uttar
Pradesh (East), Uttar
Pradesh (West), West
Loop Telecom Bengal, Andhra Pradesh,
21
Pvt. Ltd. Delhi, Haryana, Karnataka,
Maharashtra, Orissa, Tamil
Nadu (including Chennai),
Assam, Jammu &
Kashmir, Madhya Pradesh,
North East

Andhra Pradesh, Assam,

Bihar, Gujarat, Haryana,
Himachal Pradesh, Jammu
& Kashmir, Karnataka,
Kerala, Kolkata, Madhya
Datacom Operates under brand name
Pradesh, Maharashtra,
Solutions Pvt. 21 Videocon Telecommunications
North East, Orissa,
Ltd. Limited
Rajasthan, Tamil Nadu
(including Chennai), Uttar
Pradesh (East), Uttar
Pradesh (West), West
Bengal, Delhi, Mumbai

Madhya Pradesh, Kerala,

Kolkata, Punjab, Uttar
Pradesh (East), Uttar Shyam Telelink Limited & Shyani
Pradesh (West), West Telelink Limited operate together
Shyam Telelink Bengal, Andhra Pradesh, with their combined 21 licenses.
17
Limited Delhi, Haryana, Karnataka, During late 2008 Russia based group
Maharashtra, Orissa, Tamil Sistema bought majority stake in the
Nadu (including Chennai), telecom company and now they
Assam, Jammu & operate under brand name MTS
Kashmir, North East India.
Shyani Telelink Mumbai, Bihar, Gujarat,
4
Limited Himachal Pradesh
 Andhra Pradesh, Gujarat,
Haryana, Karnataka,
Kerala, Maharashtra, In 2008, Swan Telecom merged
Swan Telecom Punjab, Rajasthan, Tamil itself with Allianz Infratech (P) Ltd.
13
Pvt. Ltd. Nadu (including Chennai), During late 2008 Abu Dhabi's
Uttar Pradesh (East), Uttar Etisalat bought about 45 percent of
Pradesh (West), Delhi, the company and renamed it to
Mumbai Etisalat DB Telecom
Allianz Infratech
Bihar, Madhya Pradesh 2
(P) Ltd.

Assam, Punjab, Karnataka, Idea Cellular bought Spice

Jammu and Kashmir, Communications Ltd. in 2008 for an
Idea Cellular North East, Kolkata, West 9 amount of 2,700 crore (US$491.4
Bengal, Orissa, Tamil million).[22] So out of 122 spectrum
Nadu (including Chennai) licenses sold in 2008 Idea Cellular
owns 13 licenses. However of the 13
Spice licenses, only 7 of the licenses are in
Delhi, Andhra Pradesh,
Communications 4 use by the company and the rest are
Haryana, Maharashtra
Ltd. overlapping licenses.[23]

In January 2009, Bahrain

Telecommunications signed a deal
Assam, Jammu and with S Tel to buy 49% shares in S
Kashmir, Orissa, North Tel for $225 million. C
S Tel 6
East, Bihar, Himachal Sivasankaran owns the remaining
Pradesh (51%) share.[24][25] In May 2009,
Sahara Group bought 11.7% stake in
S Tel[26]

In late 2008 promoters of Tata

Teleservices sold 26% equity stake
to a Japanese telecom giant NTT
Jammu and Kashmir,
Tata Teleservices 3 Docomo for about 13,070 crore
Assam, North East
(US$2.38 billion) or an enterprise
value of 50,269 crore (US$9.15
billion).[27]

Parties accused of involvement

The selling of the licenses brought attention to three groups of entities – politicians and
bureaucrats who had the authority to sell licenses, corporations who were buying the licenses and
media professionals who mediated between the politicians and the corporations.

Politicians accused
Politicians named as accused in the chargesheet filed by the Central Bureau of Investigation
(CBI) in the Special CBI Court, allegations levelled against them by CBI and charges framed
against them by the Special CBI court.[28][29][30][31]

 A. Raja :
o Political career - Political party DMK, 4 times Member of Parliament, present
constituency Nilgiris, Tamil Nadu, former Union Minister of State (Rural
Development - 1999), former Union Minister of State (Health and Family Welfare
- 2003), former Union Cabinet Minister (Environment & Forests - 2004), former
Union Cabinet Minister (Communication and Information Technology - 2007 &
2009)[32][33][34][35]
o Allegation - In a joint investigation report prepared by Central Bureau of
Investigation (CBI) and Income Tax Department the agencies allege that A.Raja
could have received 3,000 crore (US$546 million) as bribe for bringing forward
the cut-off date for applications for spectrum from the initial 1 October 2007 to 25
September 2007.[36][37] The deadline switch eliminated many applications, enabling
Raja to favour a few with spectrum.[36][37] The agencies also alleged that he used
bank accounts under his wife's name in Mauritius and Seychelles to channelise
the kickbacks he received.[38] A chargesheet filed by CBI alleges that Raja
conspired with the accused, subverted the first-come first-served (FCFS) policy
and waywardly redefined it to ensure that Swan and Unitech got 2G licences.[39]
He didn’t auction the 2G spectrum or adopt some other market-determined
methodology to determine its real valuation and instead benchmarked it to a rate
discovered in 2001, when the telecom sector was at a nascent stage.[39]
o Charges - Criminal breach of trust by a public servant under section 409, criminal
conspiracy under section 120-B, cheating under section 420 & forgery under
sections 468 and 471. Booked under the Prevention of Corruption Act for
accepting illegal gratification.[28][40][41]
o Status - Taken into custody (arrested) by CBI on 2 February 2011[42] On 9 May
2012 he applied for bail for the first time since his arrest.[43][44] and was granted
bail on 15 May 2012[45][46][47] As of August 2012, trial is being conducted in
Special CBI Court.[48]

 M. K. Kanimozhi :
o Political career - Daughter of 5 time Chief Minister of Tamil Nadu, M.
Karunanidhi. Political party DMK. She is a Member of Parliament, representing
Tamil Nadu in the Rajya Sabha (the upper house of Indian Parliament).[49][50]
o Allegation - As per the chargesheet filed by CBI Kanimozhi has 20% stake in her
family owned Kalaignar TV, her step-mother Dayalu Ammal owns 60% stake in
the same channel.[51] CBI alleges that Kanimozhi was an "active brain" behind the
channel's operations[51] and she worked along with former telecom minister A.
Raja to get DB Realty promoter Shahid Balwa to circuitously route 200 crore
(US$36.4 million) to Kalaignar TV.[52] According to CBI, Kanimozhi was in
 regular touch with A Raja regarding launching of Kalaignar TV channel and its
other pending works.[52] CBI alleges that A Raja was further pursuing the cause of
Kalaignar TV not only for getting registration of the company from Ministry of
Information and Broadcasting but also for getting it in the DTH operator TATA
Sky's bouquet. She was also summoned by the Income Tax Department, Chennai
for alleged tax evasion charges.[52]
o Charges - Criminal conspiracy to cause criminal breach of trust by a public
servant, criminal conspiracy under section 120-B, cheating under section 420 &
forgery under sections 468 and 471. Booked under the Prevention of Corruption
Act.[28][40]
o Status - Taken into custody (arrested) by CBI on 20 May 2011.[53][54] Granted bail
on 28 November 2011 after spending 188 days in judicial custody.[55][56] As of
August 2012, trial is being conducted in Special CBI Court.[48]

 Pramod Mahajan- CBI decided to include the name of late Pramod Mahajan in a
separate column of the charge sheet to be filed by it soon against three cellular companies
and former officials in connection with alleged irregularities in spectrum allocation
during NDA regime causing a loss of Rs 508 crore to the exchequer.[57]

Bureaucrats accused

Bureaucrats named as accused in the chargesheet filed by CBI in the Special CBI Court,
allegations levelled against them by CBI and charges framed against them by the Special CBI
court.[28][29][30][31]

 Siddharth Behura :
o Designation - Telecom Secretary when licenses were granted.[28][58]

o Allegation - According to the chargesheet filed by CBI, Behura conspired with A.

Raja & several other accused. CBI alleges that when the application deadline time
was declared as between 3:30 PM to 4:30 PM, Behura allegedly shut counters to
physically block other telecom companies.[15]
o Charges - Criminal breach of trust by a public servant under section 409, criminal
conspiracy under section 120-B, cheating under section 420 & forgery under
sections 468 and 471. Booked under the Prevention of Corruption Act for
accepting illegal gratification.[28][59]
o Status - Taken into custody (arrested) by CBI on 2 February 2011[42] Granted bail
on 9 May 2012[60][61] As of August 2012, trial is being conducted in Special CBI
Court.[48] Deposing before JPC on 10 July 2012, Behura blamed A Raja, the then
telecom Minister, for the most of decisions related to 2G spectrum auctions.[62]

 RK Chandolia :
o Designation – Raja's private secretary when licenses were granted.[28][63]
 o Allegation - As per the charsheet filed by CBI, like Behura, Chandolia too
conspired with A. Raja and several other accused. The agency alleges that when
the application deadline time was declared as between 3:30 PM to 4:30 PM,
Chandolia along with Behura allegedly shut counters to physically block other
telecom companies.[15]
o Charges - Criminal conspiracy to cause criminal breach of trust by a public
servant, criminal conspiracy under section 120 B, cheating under section 420 &
forgery under sections 468 and 471. Booked under the Prevention of Corruption
Act[28]
o Status - Taken into custody (arrested) by CBI on 2 February 2011.[42] Granted bail
by the special CBI court 1 December 2011 but on 2 December 2011 High Court
took suo motu notice of newspaper reports of the bail granted to Chandolia and
stayed it.[64] Chandolia appealed against High Court order in Supreme Court and
on 9 May 2012 Supreme Court of India upheld the bail granted to RK Chandolia.
[65]
As of August 2012, trial is being conducted in Special CBI Court.[48]

Corporate executives accused

Corporates named as accused in the chargesheet filed by CBI in the Special Court and charges
framed against them by the Special court.[28][29][30][31]

 Sanjay Chandra
o Designation - Former MD, Unitech Wireless[28]

o Charges - Criminal conspiracy to cause criminal breach of trust by a public

servant, criminal conspiracy under section 120-B, cheating under section 420 &
forgery under sections 468 and 471. Booked under the Prevention of Corruption
Act[28]
o Status - Taken into custody by CBI on April 20, 2011,[66][67] granted bail on 24
November 2011.[68] As of August 2012, trial is being conducted in Special CBI
Court.[48]

 Gautam Doshi :
o Designation - Group MD, Reliance Anil Dhirubhai Ambani Group[28]

o Charges - Criminal conspiracy to cause criminal breach of trust by a public

servant, criminal conspiracy under section 120-B, cheating under section 420 &
forgery under sections 468 and 471. Booked under the Prevention of Corruption
Act[28]
o Status - Taken into custody by CBI on 20 April 2011,[66] granted bail on 24
November 2011.[68] As of August 2012, trial is being conducted in Special CBI
Court.[48]
 Hari Nair :
o Designation - Senior Vice-President, Reliance Anil Dhirubhai Ambani Group[28]

o Charges - Criminal conspiracy to cause criminal breach of trust by a public

servant, criminal conspiracy under section 120-B, cheating under section 420 &
forgery under sections 468 and 471.Booked under the Prevention of Corruption
Act[28]
o Status - Taken into custody by CBI on 20 April 2011,[66] granted bail on 24
November 2011.[68] As of August 2012, trial is being conducted in Special CBI
Court.[48]

 Surendra Pipara :
o Designation - Senior vice- President, Reliance Anil Dhirubhai Ambani Group[28]

o Charges - Criminal conspiracy to cause criminal breach of trust by a public

servant, criminal conspiracy under section 120-B, cheating under section 420 &
forgery under sections 468 and 471. Booked under the Prevention of Corruption
Act[28]
o Status - Taken into custody by CBI on 20 April 2011,[66] granted bail on 24
November 2011.[68] As of August 2012, trial is being conducted in Special CBI
Court.[48]

 Vinod Goenka :
o Designation - Promoter and Managing Director, DB Realty & Swan Telecom[28]

o Charges - Criminal conspiracy to cause criminal breach of trust by a public

servant, criminal conspiracy under section 120 B, cheating under section 420,
forgery under sections 468 and 471, fabrication of evidence under section 193.
Booked under the Prevention of Corruption Act[28]
o Status - Taken into custody by CBI on 20 April 2011,[66] granted bail on 24
November 2011.[68] As of August 2012, trial is being conducted in Special CBI
Court.[48]

 Shahid Balwa :
o Designation – Promoter, DB Realty & Swan Telecom[28]

o Charges - Criminal conspiracy to cause criminal breach of trust by a public

servant Criminal conspiracy under section 120-B, cheating under section 420,
forgery under sections 468 and 471 & fabrication of evidence under section 193.
Booked under the Prevention of Corruption Act.[28]
 o Status - Taken into custody by CBI on 8 February 2011,[69] granted bail on 29
November 2011.[70] As of August 2012, trial is being conducted in Special CBI
Court.[48]

 Asif Balwa (younger brother of Shahid Balwa) :

o Designation – Director, Kusegaon Fruits and Vegetables[28]

o Charges - Criminal conspiracy to cause criminal breach of trust by a public

servant, criminal conspiracy under section 120-B, cheating under section 420,
forgery under sections 468 and 471 & fabrication of evidence under section 193.
Booked under Prevention of Corruption Act[28]
o Status - Taken into custody by CBI on 29 March 2011,[71] granted bail on 28
November 2011.[72] As of August 2012, trial is being conducted in Special CBI
Court.[48]

 Rajiv Agarwal :
o Designation - Director, Kusegaon Fruits and Vegetables[28]

o Charges - Criminal conspiracy to cause criminal breach of trust by a public

servant, criminal conspiracy under section 120-B, cheating under section 420,
forgery under sections 468 and 471, fabrication of evidence under section 193.
Booked under Prevention of Corruption Act[28]
o Status - Taken into custody by CBI on 29 March 2011,[71] granted bail on 28
November 2011.[72] As of August 2012, trial is being conducted in Special CBI
Court.[48]

 Sharath Kumar
o Designation – Managing Director, Kalaignar TV[28]

o Charges - Criminal conspiracy to cause criminal breach of trust by a public

servant, criminal conspiracy under section 120-B, cheating under section 420,
forgery under sections 468 and 471 & fabrication of evidence under section 193.
Booked under Prevention of Corruption Act[28]
o Status - Taken into custody by CBI on 20 May 2011,[73] granted bail on 28
November 2011.[74] As of August 2012, trial is being conducted in Special CBI
Court.[48]

 Ravi Ruia :
o Designation - Vice Chairman, Essar Group[75][76]

o Charges - Criminal conspiracy under section 120 B & cheating under section 420
of Indian Penal Code.[75][76]
 o Status - Not taken into custody as yet.[77] As of August 2012, trial is being
conducted in Special CBI Court.[48]

 Anshuman Ruia :
o Designation - Diector, Essar Group[75][76]

o Charges - Criminal conspiracy under section 120 B & cheating under section 420
of Indian Penal Code.[75][76]
o Status - Not taken into custody as yet.[77] As of August 2012, trial is being
conducted in Special CBI Court.[48]

 Vikas Saraf :
o Designation - Director for strategy and planning, Essar Group[75][76]

o Charges - Criminal conspiracy under section 120 B & cheating under section 420
of Indian Penal Code.[75][76]
o Status - Not taken into custody as yet.[77] As of August 2012, trial is being
conducted in Special CBI Court.[48]

 IP Khaitan :
o Designation - Promotor, Loop Telecom[75][76]

o Charges - Criminal conspiracy under section 120 B & cheating under section 420
of Indian Penal Code.[75][76]
o Status - Not taken into custody as yet.[77] As of August 2012, trial is being
conducted in Special CBI Court.[48]

 Kiran Khaitan :
o Designation - Promotor, Loop Telecom[75][76]

o Charges - Criminal conspiracy under section 120 B & cheating under section 420
of Indian Penal Code.[75][78]
o Status - Not taken into custody as yet.[77] As of August 2012, trial is being
conducted in Special CBI Court.[48]

Film and entertainment persons accused

 Karim Morani :
o Designation - (Promoter and Director, Cineyug Films)[28]
 o Allegation - In the chargesheet filed by Income Tax Department the agency
alleged that Karim Morani owned Cineyug Films was a part of the circuitous
route used by another accuse Shahid Balwa to transfer illegal gratification[79] of
200 crore (US$36.4 million) to Kalaignar TV of which Kanimozhi, was a
director.[79] According to the chargesheet, Shahid Balwa and Vinod Goenka,
promoters of DB Realty transferred 209.25 crore (US$38.08 million) to
Kusegaon Fruits and Vegetables of which Shahid Balwa's younger brother Asif
Balwa was a director.[79][80] Kusegaon Fruits & Vegetables then transferred a sum
of 200 crore (US$36.4 million) to Cineyug Films whose promoter Karim Morani
transferred it to Kalaignar TV[79]
o Charges - Criminal conspiracy to cause criminal breach of trust by a public
servant, criminal conspiracy under section 120-B, cheating under section 420,
forgery under sections 468 and 471, fabrication of evidence under section 193.
Booked under the Prevention of Corruption Act[28]
o Status - Taken into custody by CBI on 30 May 2011,[81] granted bail on 28
November 2011.[74] As of August 2012, trial is being conducted in Special CBI
Court.[48]

Corporations accused

Companies named in the chargesheet filed by Central Bureau of Investigation (CBI) and charges
framed against them.[28][29][30][31]

 Unitech Wireless :
o Charges - Criminal conspiracy to cause criminal breach of trust by a public
servant, criminal conspiracy under section 120-B, cheating under section 420 &
forgery under sections 468 and 471. Booked under the Prevention of Corruption
Act.[28]
o Status - As of August 2012, trial is being conducted in Special CBI Court.[48]

 Reliance Telecom :
o Charges - Criminal conspiracy to cause criminal breach of trust by a public
servant, criminal conspiracy under section 120-B, cheating under section 420,
forgery under sections 468 and 471. Booked under the Prevention of Corruption
Act[28]
o Status - As of August 2012, trial is being conducted in Special CBI Court.[48]

 Swan Telecom :
o Charges - Criminal conspiracy to cause criminal breach of trust by a public
servant, criminal conspiracy under section 120-B, cheating under section 420,
forgery under sections 468 and 471. Booked under the Prevention of Corruption
Act[28]
 o Status - As of August 2012, trial is being conducted in Special CBI Court.[48]

Other companies named in the chargesheet are:[82][83][84]

 Loop Telecom Pvt Ltd

 Loop Mobile India Ltd
 Essar Tele Holding
 Essar (Parent group of Essar Tele Holding)

Media persons' dubious role

Main article : Radia tapes controversy

Media sources such as OPEN and Outlook reported that two senior journalists Barkha Dutt
(Group Editor of NDTV) and Vir Sanghvi (Editorial Director of Hindustan Times) knew that
corporate lobbyist Nira Radia was influencing the decisions of appointment of telecom minister.
Radia wanted A Raja to be made telecom minister.[85] The two magazines made public the
telephone conversations between Nira Radia, Barkha Dutt & Vir Sanghvi.[86][87] Radia's phones
were being tapped by Income Tax department. Critics allege that Barkha Dutt and Vir Sanghvi
knew about nexus between government and the media industry but still they supported this
corrupt activity and suppressed news reporting the discovery of the corrupt practice.[85] However
these people were not named as accused in the chargesheet filed by Income Tax Department, but
were investigated by the CBI.[citation needed]

Chronology of events and investigation

The Centre for Public Interest Litigation filed the first petition against the Union of India for
irregularities in awarding 2G spectrum licenses. The petition alleged that the government had
lost $15.53 billion by issuing spectrum in 2008 based on 2001 prices, and by not following a
competitive bidding process. This led to further petitions and the launch of a probe in 2010.[88]

2007

 May 2007: A Raja takes over as Telecom Minister.[89]

 August 2007: Process of allotment of 2G spectrum for telecom along with Universal
Access Service (UAS) Licences initiated by the Department of Telecommunications
(DoT).
 25 September 2007: Telecom Ministry issues press note fixing deadline for application
as 1 October 2007.
 1 October 2007: DoT receives 575 applications for UAS licences of 46 companies.[90]
 2 November 2007: The Prime Minister writes to Raja directing him to ensure allotment
of 2G spectrum in a fair and transparent manner and to ensure that licence fee was
 properly revised. Raja writes back to the Prime Minister rejecting many of his
recommendations.
 22 November 2007: Finance Ministry writes to DoT raising concerns over the procedure
adopted by it. Demand for review rejected.

2008

 10 January 2008: DoT decides to issue licences on first-come-first-serve basis,

preponing the cut-off date to 25 September, from 1 October 2007. Later on the same day,
DoT posted an announcement on its website saying those who apply between 3.30 pm
and 4.30 pm would be issued licences in accordance with the said policy.[91][92]
 2008: Swan Telecom, Unitech and Tata Teleservices sell off a part of their stakes at much
higher rates to Etisalat, Telenor and DoCoMo, respectively.[93][94][95]

2009

 4 May 2009: An NGO Telecom Watchdog files complaint to the Central Vigilance
Commission (CVC) on the illegalities in the spectrum allocation to Loop Telecom.
 19 May 2009: Another complaint was filed to the CVC by Arun Agarwal, highlighting
grant of spectrum to Swan Telecom at throwaway prices.
 2009: CVC directs CBI to investigate the irregularities in allocation of 2G spectrum.
 1 July 2009: Delhi HC holds advancing of cut-off date as illegal on a petition of telecom
company S-Tel.[96]
 21 October 2009: CBI registers a case and files an FIR against “unknown officers of
DoT and unknown private persons/companies under various provisions of IPC and
Prevention of Corruption Act.
 22 October 2009: Income Tax Department raids DoT offices.[97][98][99]
 16 November 2009: CBI seeks details of tapped conversation of corporate lobbyist Niira
Radia to find out involvement of middlemen in the grant of spectrum to telecom
companies. It has sought help from the Directorate General of Income Tax Investigation
regarding information on Ms. Nira Radia of M/s Noesis Consultancy and records
pertaining to middlemen regarding award of 2G spectrum licences

2010

 13 March 2010: SC upholds Delhi HC verdict on cut off date advancement as illegal[100]
[101]

 31 March 2010: CAG says that there was large scale irregularities in the spectrum
allocation.
 2 April 2010: CBI DIG (Investigations) Vineet Agarwal IRS and Director General of
Income Tax (Investigations) Milap Jain IRS, who were investigating the case, transferred.
Milap Jain was transferred as Director General of International Taxation.[102]
 6 May 2010: Telephonic conversation between Raja and Niira Radia taped by the Income
Tax Department made public by the media.[103]
 May, 2010: NGO Centre for Public Interest Litigation moves the Delhi High Court
seeking investigation into the scam by SIT.
 25 May 2010: Delhi HC dismisses the petition.
 August 2010: Appeal filed in the Supreme Court against the High Court’s order.
 18 August 2010: HC refuses to direct the Prime Minister to decide on a complaint by
Janata Party chief Swamy seeking sanction to prosecute Raja for his involvement in 2G
scam.
 13 September 2010: SC asks government, Raja to reply within 10 days to three petitions
filed by CPIL and others alleging there was a 70,000 crore (US$12.74 billion) scam in
the grant of telecom licences in 2008.
 24 September 2010: Swamy moves SC seeking direction to the PM to sanction
prosecution of Raja.
 27 September 2010: Income Tax Department informs SC of probe against firms
suspected to have violated FEMA. Says can’t deny or confirm now Raja’s involvement in
the scam.
 8 October 2010: SC asks government to respond to CAG report about the scam.[104]
 21 October 2010: Draft reports of CAG placed before the Supreme Court.
 29 October 2010: SC pulls up CBI for its tardy progress in the investigations into the
scam.[105][106]
 10 November 2010: CAG submits report on 2G spectrum to government stating loss of
176,000 crore (US$32.03 billion) to exchequer.
 11 November 2010: DoT files affidavit in SC saying CAG did not have the authority to
question the policy decision as per which licence were issued to new players in 2008.
 14 November 2010: A Raja resigns as Telecom Minister[107][108]
 15 November 2010: Kapil Sibal given additional charge of Telecom Ministry.[109][110]
 20 November 2010: Affidavit on behalf of PM filed in Supreme Court. Rejects charge of
inaction on Swamy’s complaint.[111][112][113]
 22 November 2010: CBI and Income Tax tells SC it will file charge sheet in the case
within three months.
  22 November 2010: CBI tells SC role of corporate lobbyist Niira Radia would be
questioned by it.
 24 November 2010: SC reserves verdict on Swamy’s plea seeking direction to PM for
grant of sanction to prosecute Raja.
 25 November 2010: SC ticks off CBI for not questioning Raja.
 29 November 2010: CBI files status report on 2G spectrum scam probe.
 30 November 2010: SC questions CVC P J Thomas’s moral right to supervise CBI’s
probe into 2G spectrum scam as he himself was Telecom Secretary at that point of time.
[114]

 1 December 2010: SC directs original tapes containing conversation between corporate

lobbyist Niira Radia and others be handed over to it.
 1 December 2010: Raja questions CAG findings in the SC.
 2 December 2010: Government places recorded tapes in the SC from the Directorate
General of Income Tax Investigation.
 2 December 2010: SC comes down heavily on Raja for bypassing and overruling PM’s
advice to defer allocation of 2G spectrum by a few days.
 8 December 2010: SC favours including in the probe period since 2001 when first-come-
first-serve was the norm for spectrum allocation.
 8 December 2010: SC asks Centre to consider setting up of a special court to try 2G
spectrum scam case.
 8 December 2010: Income Tax Department submits report. Says money trail covers 10
countries, including Mauritius.
 14 December 2010: Another PIL in SC seeking cancellation of new telecom licences and
2G spectrum allocated during Raja’s tenure.
 15 December 2010: Swamy files petition in a Delhi court seeking his inclusion as a
public prosecutor in 2G spectrum case.
 15 December 2010: Swamy mentions in complaint that Raja favoured “ineligible”
private companies Swan Telecom Pvt Ltd and Unitech Wireless Ltd in allocating the
spectrum.
 16 December 2010: SC decides to monitor the CBI inquiry[115][116][117]

2011

 4 January 2011: Swamy moves SC seeking cancellation of 2G spectrum licenses.

 10 January 2011: Supreme Court issues notice to Centre on the plea seeking cancellation
of 2G licenses. Also issues notices to 11 companies which allegedly did not fulfill the
roll-out obligations or were ineligible.
 30 January 2011: Government’s decision to regularise licenses of the companies which
failed to meet the deadline for roll-out obligation challenged in the Supreme Court.
 2 February 2011: Raja, former Telecom Secretary Siddharth Behura and Raja’s former
Personal Secretary R K Chandolia arrested and next day they were remanded in CBI
custody.
 8 February 2011: Raja remanded to two more days of CBI custody. Behura and
Chandolia sent to judicial custody.
 8 February 2011: Shahid Usman Balwa, promoter of Swan Telecom, arrested by CBI.
 10 February 2011: SC asks CBI to bring under its scanner corporate houses which were
beneficiaries of the 2G spectrum. Raja remanded to CBI custody for four more days by a
special CBI court along with Balwa.
 14 February 2011: Raja’s CBI custody extended for three more days. Balwa’s custody
extended for four days.
 17 February 2011: Raja sent to Tihar Jail under judicial custody.
 18 February 2011: Income Tax Department questions Kani Mozhi in Chennai
Headquarters.
 24 February 2011: CBI tells a Delhi court that Balwa facilitated transaction to Kalaignar
TV.
 28 February 2011: Raja seeks judicial proceedings through video conferencing stating
that he faces threat to life from fellow prisoners.
 1 March 2011: CBI tells SC that 63 persons are under scanner. Raja allowed by CBI
court to appear before it via video-conferencing.
 14 March 2011: The Delhi High Court sets up special court to deal exclusively with 2G
cases. Balwa also allowed to appear via video-conferencing.
 17 March 2011: SC reserves order on cancellation of 2G licenses. It rejected companies'
claim saying that Principle of Estoppel can't be applied to protect illegality.[118][119]
 29 March 2011: SC permits CBI to file charge sheet on 2 April instead of 31 March.
Two more persons — Asif Balwa and Rajeev Agarwal — arrested.
 2 April 2011: CBI files its first charge sheet in the 2G spectrum allocation scam.[120][121]
[122]

 25 April 2011: CBI files second charge sheet and court issues summons to Kanimozhi,
Sharad Kumar and Karim Morani taking cognizance of the charge sheet.[123][124][125]
 6 May 2011: Kanimozhi and Sharad Kumar appear before court and file bail pleas while
Morani sought exemption from appearance on medical ground.[126][127][128]
 6 May 2011: SC issues contempt notice to Sahara India managing director Subroto Roy
and two others for alleged interference in the ongoing ED investigation into the 2G
spectrum case.[129][130]
 7 May 2011: Special CBI Court reserves order on Kanimozhi and Sharad Kumar’s bail
applications.
 14 May 2011: Special CBI Court defers order on their bail pleas for 20 May.
 20 May 2011: Special CBI Court rejects bail pleas of Kanimozhi and Sharad Kumar and
orders their forthwith arrest saying that there was a possibility of witnesses being
influenced considering the magnitude of the crime.[131][132]
 8 June 2011: Delhi HC judge Ajit Bharihoke rejects bail pleas of Kanimozhi and Sharad
Kumar citing that there are certain prima facie evidences against the accused and they
may be in a position to influence the 2G probe[133][134]
 20 June 2011: SC rejects Kanimozhi’s bail plea[135][136][137]
 25 July 2011: Arguments on Charge begins. Raja seeks to make Prime Minister and
former finance minister P Chidambaram as witness.
 26 August 2011: Special CBI court allows Subramanian Swamy to argue his own case
(mainly to address the possible loop holes in CBI investigation of the case)[138][139]
 30 August 2011: Income Tax Department orders freezing of accounts, attachment of
properties worth 223 crore (US$40.59 million) of five companies mainly related to DB
Realty under the provisions of Prevention of Money Laundering Act (PMLA)[140][141]
 1 September 2011: ED files status report in Supreme Court, says there have been FEMA
violation of 10,000 crore[142]
 15 September 2011: Swamy pleads before special CBI court that P Chidambaram should
be made co-accused[143]
 22 September 2011: CBI defends Chidambaram in SC, blames DoT for all wrongs.
 26 September 2011: CBI moves plea for framing fresh charge for criminal breach of
trust against Raja, Chandolia and Behura.[144][145]
 29 September 2011: CBI says role of Anil Ambani being probed, gives a virtual clean
chit to Tata and Videocon group.[146][147]
 9 October 2011: CBI files FIR against Maran and his brother in Aircel-Maxis deal.[148][149]
[150]

 10 October 2011: SC reserves order against Subramanian Swamy’s plea for a probe into
Home Minister Chidambaram’s role in the 2G scam.[151][152] On the same day CBI books
 former telecom minister and DMK leader Dayanidhi Maran and his brother and media
baron Kalanithi Maran[153]
 22 October 2011: Special CBI Court finds prima facie evidence to put on trial all 17
accused including Raja on various counts like criminal conspiracy, breach of trust,
cheating and forgery.[154][155]
 3 November 2011: Special CBI court dismisses bail pleas of all the 8 applicants
(including Kanimozhi)[156]
 8 November 2011: Special CBI court orders CBI to give copy of file on sale of equity by
telecom companies (for investigating P Chidambaram's involvement) to Swamy[157][158]
 9 November 2011: Delhi HC refuses to grant interim bail to Karim Morani on health
grounds wondering Why everybody falls sick once he is in custody? HC issues notice to
the CBI on its reply on the bail pleas of the five accused by 1 December.[159][160]
 11 November 2011: Trial of the 17 accused begins in Patiala House special CBI court.
[161][162]

 14 November 2011: UPA govt moves SC seeking to restrain Dr Subramanian Swamy

from making public allegations against the UPA leadership (especially Home Minister P
Chidambaram and UPA Chairperson Sonia Gandhi) in the 2G scam case[163][164]
 22 November 2011: The Special CBI court shifts the trial to the Tihar Jail complex
following a Delhi high court order[165][166]
 23 November 2011: SC grants bail to 5 corporate executives – Sanjay Chandra of
Unitech Wireless, Vinod Goenka of Swan Telecom as well as Reliance Group's Gautam
Doshi, Surendra Pipara and Hari Nayar.[167]
 28 November 2011: HC grants bail to DMK MP Kanimozhi and 4 others namely Karim
Morani, Sharad Kumar and Asif Balwa and Rajeev Agarwal. The court upheld the
principle of parity under Section 144 of the Constitution of India that upholds an order
passed by the SC.[168][169]
 29 November 2011: The special CBI court grants bail to Shahid Balwa citing principle of
parity that SC and HC have already granted bail to 10 other accused[170][171]
 1 December 2011: The special CBI court grants bail to A. Raja's ex-private secretary R.
K. Chandolia and puts additional condition to not visit the DoT without prior permission
of the court[172][173]
 2 December 2011: Taking a suo motu cognizance, HC stays bail given by trial court to R
K Chandolia[174]
 7 December 2011: SC stays HC's suo motu order against Chandolia's bail[175][176]
  8 December 2011: The special CBI court accepts Swamy's plea against Chidambaram to
become a witness in his own complaint and examine 2 witnesses, including senior CBI
official and senior Finance Ministry official[177][178]
 12 December 2011: CBI files third charge sheet naming Essar Group promoters Ravi
Ruia, his son Anshuman Ruia and its director (Strategy and Planning) Vikas Saraf, Loop
Telecom promoters Kiran Khaitan (sister of Ravi Ruia) and her husband I P Khaitan. It
also charge sheets Loop Mobile India Ltd, its subsidiary Loop Telecom Pvt Ltd and Essar
Tele Holding.[179][180]
 16 December 2011: HC rejects bail plea of Siddharth Behura saying "he was the
‘perpetrator’ of the illegal designs of Raja and would not claim benefit of parity with 10
others released on bail"[181]

2012

 2 February: The Supreme court of India cancelled all 122 licenses allotted by A Raja
and imposed Rs 5 crore(US$ 1,018,122) fine on Unitech, Swan and Tata Teleservices. It
also imposed a fine of Rs 50 lakh on Loop Telecom Pvt Ltd, S-Tel, Allianz Infratech and
Sistema Shyam Tele Services Ltd. It also asked trial court to decide whether Home
Minister P Chidambaram should be made co-accused in 2G scam.[182][183]
 4 February: The special court of justice O.P Saini dismissed the plea of Subramanian
Swamy to make then Finance Minister P.Chidambram as co-accused in the 2G scam.[184]
 8 February: ED and I-T registers money laundering case against DMK leader Dayanidhi
Maran[185] and his brother Kalanithi Maran for allegedly receiving illegal gratification of
about 550 crore in the Aircel-Maxis deal.[186]
 9 February: Essar Group and Loop Telecom approach Supreme Court against its trial
before Special CBI Court in 2G case.[187][188]
 15 February: Supreme Court refused to grant interim stay on the summonses issued
against Essar Group, Loop Telecom and their officials by a special CBI court to appear
before it on 22 February for their alleged involvement in a 2G spectrum scam.[189]
 22 February: CBI lodges strong protest with CVC on the "dirty tricks" of certain Income
Tax officials to intimidate crucial witnesses in the 2G case allegedly at the behest of
DMK’s Minister of State (Finance) SS Palanimanickam. Dr. Swamy said he would
approach Supreme Court on this matter.[190]
 23 February: Subramanian Swamy files petition in Supreme Court challenging trial
court's order which had dismissed Swamy's plea to make Union Home Minister P.
Chidambaram as a co-accused in the 2G scam.[191]
 2 March: Govt of India files review petition in Supreme Court seeking partial review of
the court's 2 February 2012 order which had quashed 122 licenses.[192] The Govt
questioned Supreme Court's authority over ruling against the first-come first-served
policy but stayed away from challenging the cancellation of 122 licences issued during
the tenure of A Raja as Telecom Minister.[193] On the same day former telecom minister A
 Raja, Sistema, majority shareholder in MTS India, Uninor and other telecom companies
too filed a review petition in Supreme Court.[194]
 4 April: Other than Government of India's partial review petition Supreme Court
dismissed all 10 review petitions.[195] The telecom companies whose review petition was
dismissed include Videocon Telecommunications Ltd, S Tel Ltd, Sistema Shyam
Teleservices Ltd, Tata Teleservices Ltd, Unitech Wireless (Tamil Nadu) Pvt Ltd, Etisalat
DB Telecom Pvt Ltd and Idea Cellular Ltd.[195]
 12 April: Government filed Presidential reference in Supreme Court seeking the court's
opinion on various issues arising from its 2 February 2012 judgement[196]
 9 May: Supreme Court granted bail to Siddharth Behura[197] and upheld RK Chandolia's
bail.[198] On the same day A Raja also applied for bail.[199]
 15 May: Bail granted to A Raja with a condition to get court's permission for visiting
Tamil Nadu[45][46] He walked out of Tihar jail after 15 months.[200]
 6 June: Special CBI Court granted permission for Raja to visit Tamil Nadu[201]
 3 July: Briefing the Joint parliamentary committee probing the scam, ED claimed that it
has enough evidence to convict DMK chief Karunanidhi's wife and daughter Kanimozhi.
[202]

 31 July: Former DoT senior official AK Srivastava confirmed CBI's allegation in his
testimony saying A Raja as telecom minister was the final authority for taking decisions
on policy matters. He in his statement to CBI earlier had mentioned that Raja had
recorded the cut—off date of October 1, 2007 for receiving applications for grant of the
2G spectrum licences on a DoT file.[203]
 1 August: The Supreme Court, hearing the Presidential reference on the ‘2G judgment,’
said implementation of first served (FCFS) policy for allotment of spectrum was flawed.
The Chief Justice of India said, "The moment you change the criterion and distort the
policy, it ceases to be FCFS policy. If you insist on making payment at the last minute
after changing the cut-off date, then it is not FCFS, it is an out-of-turn policy."[204]
 3 August: According to the directions of the Supreme Court, Govt of India revised the
spectrum price to 14,000 crore (US$2.55 billion)[7] which demolished the "zero loss
theory" and further established 176,000 crore (US$32.03 billion) revenue loss calculated
by CAG.[6]
 9 August: The Government again sought extension of time from the Supreme Court till
November 12 for commencing auction of 2G spectrum licences. The court, while
quashing 123 licences in February 2012, had given four months for their fresh auction
which was extended till August 31.[205]
 11 Nov: The daily trial in Justice OP Saini's special CBI court completes 1 year.
Deposition of 77 witnesses out of a total of 154 witnesses complete.[206]
Licenses quashed
On 2 February 2012 Supreme Court of India delivered judgement on petitions filed by
Subramanian Swamy and Centre for Public Interest Litigation (CPIL) which had challenged
allotment of 2G licenses granted in 2008.[207] The Supreme Court quashed all 122 spectrum
licences granted during the tenure of former communications minister A Raja.[207] and described
the allocation of 2G spectrum as "unconstitutional and arbitrary".[208] The bench of Justice GS
Singhvi & Justice AK Ganguly imposed fine of 5 crore (US$0.91 million) on Unitech Wireless,
Swan telecom and Tata Teleservices and 50 lakh (US$91,000) fine on Loop Telecom, S Tel,
Allianz Infratech and Sistema Shyam Tele Services Ltd.[4] The Supreme Court's ruling said the
current licences will remain in place for four months, in which time the government should
decide fresh norms for issuing licences.[209]

The Supreme Court said in its order that then telecom minister A. Raja "wanted to favour some
companies at the cost of the public exchequer" and listed seven steps he took to ensure this
happened.[4][210] According to the Supreme Court of India the seven steps were :

1. After taking over as telecom minister, Raja directed that all applications received for
UAS licences should be kept pending till receipt of the Trai's recommendations.[4][210]
2. The recommendations made by Trai on 28 August 2007, were not placed before the full
Telecom Commission which would have included the finance secretary. The notice of the
meeting of the Telecom Commission was not given to any of the non-permanent
members though Trai's recommendations for allocation of 2G spectrum had serious
financial implications and it was therefore necessary for DoT to take the finance
ministry's opinion under the Government of India (Transaction of Business) Rules, 1961.
[4][210]

3. The DoT officers who attended the Telecom Commission meeting held on 10 October
2007, had no choice but to approve Trai's recommendations, since they would otherwise
have "incurred" Raja's "wrath".[4][210]
4. Since Cabinet had approved recommendations made by the Group of Ministers, the DoT
had to discuss the issue of spectrum pricing with the finance ministry. But, since Raja
knew that the finance secretary had objected to the allocation of 2G spectrum at rates
fixed in 2001, he did not consult the finance minister or other officials.[4][210]
5. Raja brushed aside the law minister's suggestion that the matter should be placed before
the empowered group of ministers. Also, within hours of the receipt of the suggestion
made by the PM in his letter dated 2 November 2007, that keeping in view the
inadequacy of spectrum, transparency and fairness should be maintained in allocation of
the spectrum, Raja rejected it saying that it would be unfair, discriminatory, arbitrary and
capricious to auction spectrum to new applicants because it would not give them a level-
playing field. He also introduced a cut-off date of 25 September 2007, for considering
applications though only the previous day a DoT press release had said 1 October 2007,
would be the last date. This arbitrary action of Raja "though appears to be innocuous was
actually intended to benefit some of the real estate firms who did not have any experience
 in dealing with telecom services and who had made applications only on 24 September
2007, i.e. one day before the cut-off date fixed by the C&IT minister on his own".[4][210]
6. The cut-off date of 25 September 2007, decided by Raja on 2 November 2007, was not
made public till 10 January 2008, and the first-come-first-served principle followed since
2003 was changed by him at the last moment through a press release dated 10 January
2008. "This enabled some of the applicants, who had access either to the minister or DoT
officers, get bank drafts prepared towards performance guarantee of about Rs 1,600
crore".[4][210]
7. "The manner in which the exercise for grant of LoIs to the applicants was conducted on
10 January 2008 leaves no room for doubt that everything was stage managed to favour
those who were able to know in advance change in the implementation of the first-come-
first-served policy." As a result, some firms which had submitted applications in 2004 or
2006 were pushed down in the priority and those who had applied between August and
September 2007 succeeded.[4][210]

Telecom companies affected by cancellation of licenses

The table below shows list of companies whose license were cancelled[211][212]

Number of
Name of company Parent group licenses
cancelled
Joint venture between Unitech Group of India and
Uninor 22
Telenor of Norway Unitech Group
Sistema Shyam
Joint venture between Shyam group of Indian and
TeleServices Limited, now 21
Sistema of Russia
MTS India
Loop Mobile formerly BPL
Owned by Khaitan Holding Group 21
Mobile
Videocon
Telecommunications Owned by Videocon group of India 21
Limited
Joint venture between Swan Telecom of India and
Etisalat-DB 15
Etisalat of UAE
Aditya Birla Groupof India (49.05%), Axiata Group
Idea Cellular Berhad of Malaysia (15%) & Providence 13
Equity(10.6%)of USA
Joint venture between C Sivasankaran of India and
Batelco of Bahrain. After the Supreme Court's
S Tel decision Batelco sold its 42.7% stake to C 6
Sivasankaran company Sky City Foundation Ltd. for
$175 million[213]
Tata Teleservices Owned by Tata Group of India 3
Aftereffects of Supreme Court's verdict

 Batelco quits India - Batelco, the Bahrain telecommunications company holding 42.7%
stake in S Tel declared that it has agreed to sell its entire holding to Indian partner Sky
City Foundation Ltd for 65.8 million Bahraini dinar ($174.5 million).[213][214][215]
 Telenor terminates agreement and sues Unitech - On 21 February 2012 Telenor,
majority stakeholder in Uninor, terminated its agreement with its Indian partner Unitech
and sued it seeking “indemnity and compensation”.[216][217][218]
 Etisalat sues Shahid Balwa and Vinod Goenka - On 23 February 2012 Etisalat of the
Etasalat-DB Telecom sued Shahid Balwa and Vinod Goenka, promoters of its Indian
partner DB Realty for fraud and misrepresentation.[219][220][221]

Aircel-Maxis deal controversy

See also: C Sivasankaran, Dayanidhi Maran, T Ananda Krishnan, and Maxis Communications

On 6 June 2011, former Aircel Chief C Sivasankaran complained to the CBI that he was not
given telecom licence and Dayanidhi Maran (the then telecom minister) forced him to sell his
company Aircel to Malaysia-based Maxis Communications group owned by T Ananda Krishnan.
The licences were allegedly issued only after the deal was struck. Sivasankaran also alleged that
Maran brothers Dayanidhi and Kalanidhi got kickbacks in the form of investments made by the
Maxis group through Astro network in Sun TV (owned by Maran family).[148][149][150] Dayanidhi
Maran was forced to resign due to these allegations on 7 July 2011.[222]

Subsequently on 10 Oct 2011, the CBI registered an a case and raided various properties owned
by Marans. CBI sources said they could not find any evidence of coercion in the sale of Aircel,
but they did find substantial evidence that Maran had favoured the takeover of the company by
Maxis and deliberately delayed Sivasankar’s files.[148][149][150] On 8 February 2012, ED registered
money laundering case against Dayanidhi Maran[223] and his brother Kalanithi Maran for
allegedly receiving illegal gratification of about 550 crore in the Aircel-Maxis deal.[224]

During the CBI probe, Sivasankaran told that the Maran brothers had allegedly issued life threats
forcing him to sell his 74% stake in Aircel to Maxis. He provided the CBI a list of over 10
witnesses, to prove his allegations. In September 2012, CBI said that it has finished the
investigations within India and is waiting for response of a Letters Rogatory sent to Malaysia and
a questionnaire sent to T Ananda Krishnan, after which it will file a chargesheet.[225]

Dr Subramanian Swamy alleged that in 2006, a company controlled by then Minister of Finance
P Chidambaram’s son Karti got five per cent stake in Sivasankaran’s Aircel to get part of ₹4000
crore that the Maxis Communications paid for 74 per cent stake in Aircel. He alleged that Mr
Chidambaram withheld the FIPB clearance to the deal till his son got the five per cent shares in
Siva’s company.[226] Subsequently the issue was raised on multiple times in Parliament of India
by the opposition which demanded resignation of Mr P Chidambaram.[227] He and the
government denied all the allegations.[228] However, according to The Pioneer and India Today
reports, documents show that approval to the FDI proposal was indeed delayed about 7 months
by P Chidambaram.[226][229][230]

Response to scam
 Opposition demands Joint Parliamentary Committee (JPC) - As soon as the Indian
media started citing Comptroller and Auditor General of India's report which pegged the
loss at 1.76 lakh crore, the Indian opposition parties unanimously demanded formation
of Joint parliamentary committee (JPC) to investigate 2G scam.[231][232] However the
Indian government rejected the demand of opposition.[232] Later when the winter session
of parliament began on 9 November 2010, opposition again pressed for (JPC) but once
again the demand was rejected.[232] The opposition's demand for (JPC) gained further
momentum when Comptroller and Auditor General of India's report was tabled in
Parliament on 16 November 2010.[233] The opposition blocked parliament proceedings
and again pressed for JPC.[234] With Govt again rejecting the demand there was logjam in
parliament.[235] Speaker of the Lok Sabha, Meira Kumar tried to break the logjam but her
efforts didn't bear any fruit.[236] Finally the winter session of parliament concluded on 13
December 2010 . The plan was to introduce 22 new bills, take up 23 pending bills for
consideration and passing and withdraw three bills but that didn't happen because the
parliament was allowed to function for only 9 hours.[237] In February 2011, after resisting
the Opposition demand for over three months, the government finally agreed to constitute
a Joint Parliamentary Committee (JPC) to probe the 2G spectrum allocation issue. The
government announced it formally on 22 February 2011.[238] On 24 July 2012, JPC took
CBI to task for the leniency shown to PM, AG, Dayanidhi Maran and Chidambaram and
reluctance to investigate their role in 2G Spectrum scam.[239] Recently after questioning
former telecom minister Dayanidhi Maran, his brother Kalanithi and the head of Maxis
Communications, CBI alleged that Maran brothers have accrued illegal gratification of
Rs 550 crore by purchase of Sun Direct TV share at highly "inflated prices".[240]

 Jayalalitha accuses M. Karunanidhi - In early November 2010 Jayalalithaa accused the

state chief minister M Karunanidhi of protecting A. Raja from corruption charges and
called for A. Raja's resignation.[241] By mid November A. Raja resigned.[242]
 CAG issues show-cause notices - In mid November the comptroller Vinod Rai issued
show-cause notices to Unitech, S Tel, Loop Mobile, Datacom (Videocon), and Etisalat to
respond to his assertion that all of the 85 licenses granted to these companies did not have
the up-front capital required at the time of the application and were in other ways illegal.
[243]
Some media sources have speculated that these companies will receive large fines but
not have their licenses revoked, as they are currently providing some consumer service.
[243]

 Internal appraisal after Prime Minister's criticism - In June 2011, the Prime Minister
Manmohan Singh criticised the CAG for commenting on policy issues. He also warned
CAG "to limit the office to the role defined in the constitution."[244] After Prime Minister's
criticism, the CAG conducted a "rigorous internal appraisal" and stood by its findings,
also citing additional crucial events to corroborate them. The CAG reiterated that there
 was "an undeniable loss to the exchequer", the calculation of which was based upon 3
estimates - 3G auctions, Swan and Unitech transactions. It also cited the Supreme Court
judgement on February 2, 2012 that the actions of Mr. Raja and officers of the
Department of Telecom were "wholly arbitrary, capricious and contrary to the public
interest, apart from being violative of the doctrine of equality. The material produced for
the quote showed that the Minister for C&IT wanted to favour some companies at the
cost of the public exchequer." The CAG also said that its estimation of loss of 1.76-lakh
crore was justified as the TRAI’s collation of reserve price for 2G spectrum as of May,
2012 was approximately same as the calculation in CAG report of November 2010 on 2G
scam. It also highlights that the TRAI had recommended a reserve price of 2G spectrum
of Rs. 18,000 crore for a pan-India licence for 5 MHz spectrum which was higher than
the 3G value of Rs. 16,750 crore for 5 MHz used by the CAG for arriving at a [loss]
figure of 1,76,000 crore. It concluded by saying that it was only examining the
"implementation of policy" and that the policy making was government's prerogative.[245]

Indian Telecom Spectrum Auction

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In India, the Department of Telecommunications (DoT) conducts auctions of licenses for
electromagnetic spectrum. India was among the early adopters of spectrum auctions beginning
auctions in 1991. Despite the early start in auctions, services were slow to roll out caused by
unforeseen problems with the design and rules of the auction.[1] Potential service providers were
required to seek foreign partners, as the DoT felt that no Indian company alone had the financial means
to enter the industry. Bidding for all licenses required a two stage screening process.

Contents
 1 2010 Spectrum Auction
o 1.1 Bidders

o 1.2 Results

 2 2012 Spectrum Auction

o 2.1 Bidders

o 2.2 Results

 3 References

2010 Spectrum Auction

In 2010, the 3G and 4G telecom spectrum were auctioned in a highly competitive bidding. The
winners were awarded spectrum in September, and Tata Docomo was the first private operator to
launch 3G services in India.[2] The government has earned 67,719 crore (US$12.32 billion) from
the 3G spectrum auction. While the broadband wireless spectrum auction generated a revenue of
38,500 crore (US$7.01 billion). Together 3G and BWA auction, the government of India earned
a total revenue of over 106,219 crore (US$19.33 billion).

Bidders

The private companies which participated in the auction were:

 Airtel
 Aircel
 Idea
 Reliance Communications
 S Tel
 Tata Teleservices
 Vodafone Essar (now Vodafone India)
Apart from the above state-owned BSNL and MTNL were also awarded spectrum, although they
did not participate in the auction. Both these state-owned operators were given a head start by the
government in the 3G space by allotting the required 3G spectrum, on the condition that each
would pay an amount which would be equivalent to the highest bid in the respective service
areas as and when the 3G auctions took place. [3] BSNL paid the Indian government 10,187
crores for spectrum in all 20 circles it operates in. State-owned MTNL provides 3G services in
the other 2 circles - Delhi and Mumbai. [4]

Results

The auction took place over 34 days and consisted of 183 rounds of bidding. The most expensive
telecom circle was Delhi at a price of 3316.94 crore per operator. The five most expensive
circles were Delhi, Mumbai, Karnataka, Tamil Nadu and Andhra Pradesh. They accounted for
65.56% of the total bids.[4][5]

Circle / Operator Vodafone Airtel Reliance Tata Idea Aircel S Tel BSNL MTNL Total
Delhi 4
Mumbai 4
Maharashtra & Goa 4
Gujarat 4
Andhra Pradesh 4
Karnataka 4
Tamil Nadu 4
Kolkata 4
Kerala 4
Punjab 5
Haryana 4
Uttar Pradesh (East) 4
Uttar Pradesh (West) 4
Rajasthan 4
Madhya Pradesh 4
West Bengal 5
Himachal Pradesh 5
Bihar 5
Orissa 4
Assam 4
North East 4
Jammu & Kashmir 5
Total 9 13 13 9 11 13 3 22 2 93
2012 Spectrum Auction
In 2012, the DoT auctioned 2G spectrum in both GSM and CDMA bands. The 1800 Mhz band
and 800 Mhz band are currently being used for GSM and CDMA services respectively. Eleven
blocks having 1.25 Mhz each in the 1800 Mhz frequency band were auctioned, except in
Mumbai and Delhi where only eight blocks were available. Three of the eleven blocks, in each
circle, were reserved or new telecom players for operators whose licences were cancelled by the
Supreme Court on 2 February 2012, following the 2G spectrum scam. New players and
companies affected by the Supreme Court verdict will have to win at least 4 blocks in each circle
to start or continue their operations in that circle. Existing players whose licences were not
affected by the Supreme Court verdict can bid for only 2 blocks in each circle. This applies to all
circles of Airtel and Vodafone, and in some circles for Idea.[6]

Three blocks of 1.25 Mhz frequency each in the 800 Mhz band were also available for auction.[7]
Initially, only Videocon Telecommunications Limited and Tata Teleservices (Tata DoCoMo
CDMA) had applied to participate in the auction for spectrum in 800MHz band (CDMA). Both
companies withdrew their applications before November 5, the last date for withdrawal of
applications. Videocon was announced as a pre-qualifier in the bidding process by the DoT on
October 29, but withdrew its application on November 2.[8] Tata Teleservices was also
announced as a pre-qualifier on October 29, but withdrew its bid later. The withdrawals meant
that there were no bidders left and the CDMA spectrum auction was subsequently cancelled.[9]

The final list of bidders was announced on November 6. This was followed by a mock auction on
November 7 and 8 and the e-auction of 1,800 MHz band began on November 12.[10]

Bidders

The companies which participated in the auction for spectrum in 1800MHz band (GSM) were:

 Airtel
 Idea
 Vodafone
 Videocon Telecommunications Limited
 Telewings Communications Services Private Limited

Results

The auction took place over 2 days (starting November 12 and ending November 14) and
consisted of 14 rounds. The government received bids worth a total of 9,407 crore, far lower
than its target of 28,000 crore from the sale of 2G spectrum in the GSM band. None of the
bidders bid for a pan-India spectrum for which the reserve price was set at Rs 14,000 crore for 5
Mhz of airwaves.[11] Out of the 144 blocks of spectrum on offer, 101 got bids. Delhi, Mumbai,
Karnataka and Rajasthan circles did not receive any bids. When asked about the government's
plans for spectrum that remained unsold in the 2G auction, Minister of Communications and
Information Technology Kapil Sibal said, "Of course there will be an auction. There is no doubt
about that. What procedure we follow for that auction is something that we will decide in another
few weeks."[12][13]

Circle / Operator Vodafone Airtel Uninor Idea Videocon

Delhi† - - - - -
Mumbai† - - - - -
Maharashtra & Goa
Gujarat
Andhra Pradesh
Karnataka† - - - - -
Tamil Nadu
Kolkata
Kerala
Punjab
Haryana
Uttar Pradesh (East)
Uttar Pradesh (West)
Rajasthan† - - - - -
Madhya Pradesh
West Bengal
Himachal Pradesh
Bihar
Orissa
Assam
North East
Jammu & Kashmir
No. of Circles 15 1 6 8 6
Total Amount ( crores) 1,127.94 8.67 4,018 2,031 2,221

†No bids.