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Making it clear that a foreign-based company and its owners cannot be permitted to use the resources of India and make money despite frustrating the process of law, the Supreme Court Friday said that the 2G spectrum of network provider Aircel shall be seized if the Malaysia-based controller company and its owner do not appear before 2G trial court in four weeks.
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A bench led by Chief Justice of India J S Khehar asked the Maxis group of companies and its owner Ananda Krishnan to show up before the trial court and explain their non-appearance, despite repeated summons and warrants, if they want the adverse order to be altered. “We will not allow anyone to use the assets of this country and run away from the process of law. If he (Krishnan) wants to use 2G spectrum, he must come here and face the law. He cannot use the resources of this country and not face the law,” said the bench, also comprising Justices N V Ramana and D Y Chandrachud.
Issuing his first order in the batch of 2G cases after taking over as CJI, Justice Khehar was unequivocal: “Everyone must face the due process of law. He must present himself before the legal process. One cannot use the assets of this country and say, no I will not come there. We will not allow that.”
“Spectrum is a very valuable resource and you can make a lot of money using it. If that money is earned on account of fraud and not facing the legal process, then we cannot allow that money to be earned by anyone. If a party refuses to accept summons and to appear, then we cannot let them use the spectrum until they appear and explain themselves. They cannot defeat the process of law,” the bench said.
It maintained that all earnings of Aircel shall be restrained and that the prohibition shall become enforceable if Maxis, Krishnan and one of its directors, Augustus Ralph Marshall, fail to accept court summons and show up. The bench also stayed “selling and trading in the 2G spectrum under consideration” – an order which is likely to affect India’s biggest consolidation deal in the telecom sector whereby Reliance Communications of the Reliance Anil Dhirubhai Ambani Group had declared merger of its mobile phone services business with Aircel.
The court order on prohibiting share-holding pattern of Aircel came after senior counsel K K Venugopal and Anand Grover, representing the CBI in 2G cases, informed the bench that RCom and Maxis had declared a financial arrangement with respect to stakes in Aircel. “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,” said the bench, asking the Department of Telecom and Ministry of Communication and Information Technology to devise modalities in the meantime to ensure Aircel subscribers are not affected and that they get services from some other network provider. The government has also been asked to get the apex court order published in two leading newspapers in Malaysia so that Maxis and others are officially apprised of the mandate.
“It is also clarified that in case the proposed order is passed, it will not be open to any of the accused to raise an objection with reference to any monetary loss, emerging out of the proposed order,” stated the bench, fixing the next hearing for February 3. Meanwhile, the bench was also informed that the 2G trial court was likely to frame charges against the other accused in the matter, including former Union Telecom Minister Dayanidhi Maran and his brother Kalanithi, on January 9.
According to the CBI chargesheet, Aircel owner C Sivasankaran was arm-twisted by then minister Dayanidhi Maran to sell majority shares to Krishnan and his company Maxis in Malaysia. Maran allegedly received a bribe of Re 642 crore for this deal. Despite repeated summons and arrest warrants issued by the trial court, Krishnan and the director of Maxis did not appear before the 2G trial court, either in person or through their legal representative. During the hearing on Friday, the bench also agreed to examine whether the CBI and Enforcement Directorate should engage their own counsel and told senior advocate K K Venugopal that he should continue as amicus curiae to assist the court in the matter.
“Every party has a right to choose his own counsel. We cannot thrust a lawyer on any party. Let us see who appears for them (CBI and ED),” observed the bench, while referring to a court order in September 2015 when the bench had requested Venugopal to continue appearing for the agencies as amicus. The senior counsel wanted to leave the matter in the wake of a communication he had received from an Under Secretary-level officer from the Revenue Department about his removal.
On February 3, the bench will also take up a plea by BJP MP Subramanian Swamy on alleged illegalities in grant of a clearance by the Foreign Investment Promotion Board to Maxis in taking over stakes in Aircel in 2006.