Khurshid ‘role’ in clean chit to Essar-Loop: SC seeks reply

Apex court asks why no charges were filed under Prevention of Corruption Act against errant officials.

Written by Krishnadas Rajagopal | New Delhi | Published: January 6, 2012 12:23 am

The Supreme Court today issued formal notice to the government in response to an application directly accusing Union Law Minister Salman Khurshid of having used his influence to publicly give a “clean chit” to Loop Telecom and Essar Group in the 2G spectrum case.

A special bench of Justices G S Singhvi and A K Ganguly directed the Union of India,Department of Telecom,CBI and ED to file their responses on the application by an NGO,CPIL,expressing dissatisfaction that higher-ups in the government and within the CBI pressed the agency’s investigating officers to frame lighter charges of cheating and conspiracy — and not corruption — in the Loop/Essar probe. The court scheduled the hearing for January 20.

CPIL is the NGO on whose petition the SC had ordered a CBI inquiry into the 2G spectrum scam,which led to the arrests and chargesheeting of former telecom minister A Raja,DMK MP Kanimozhi and several senior executives from top corporate houses.

The application questions why no charges under the Prevention of Corruption Act have been instituted against public officials concerned with the issuance of Letters of Intent for 2G spectrum in the Department of Telecom.

“The interference of an influential minister in the government,Law Minister Salman Khurshid,is evident. He is publicly giving clean chit to Essar/ Loop. A recent opinion by his ministry giving clean chit to Essar Group is attached herewith,” the 10-page application submitted.

“He (Khurshid) is not a party here,” the bench interjected.

“The law minister tried to influence the CBI by saying that this investigation is not a criminal one at all. The letter was at the behest of the law minister,” replied Prashant Bhushan,appearing for CPIL.

The application adds that the Loop Telecom-Essar Group link through a “web of companies” is similar to that of Swan-Reliance wherein CBI has already filed chargesheets against officials of Swan,Reliance and also public officials. That chargesheet had included offences under the Prevention of Corruption Act.

The application accuses CBI Director AP Singh and CBI’s Director of Prosecution Abdul Aziz of having played a role in the outcome of the third chargesheet against Loop/Essar.

“The CBI Director of Prosecution,Abdul Aziz,overruled the report of the investigating officers and said no criminal case is made out in this matter. Giving a clean chit to the companies,he said that this was merely a contractual violation. It is pertinent to mention here that Aziz’s son is employed in Essar-Loop group and he reportedly recused himself belatedly from the case. Despite this,his opinion was factored in decision making,” the application alleges.

Singh,the application submits,though disagreeing with Aziz that no criminal case was made out,however,concluded that DoT officers were at the time of the LOI issuance “ignorant” that Loop was controlled by the Essar Group.

“Not charging the accused under the Prevention of Corruption Act,ignoring the findings of the Investigating Officers,is unwarranted. This is unacceptable,especially,in a case where the investigations are being monitored by the Honourable Supreme Court and investigating officers are reporting to this court,” the application submitted.

The application mentions the legal opinion given by Attorney General G E Vahanvati,who reproduced the findings of the probe officers,but does not delve further into the specific charges involved against Loop/Essar.

There is a possibility that the trial on the third chargesheet may be shifted out of the Special Court as cheating can also be tried before a magistrate,CPIL said.

The application also accused the CBI of “deliberately going slow” on the investigation into the corruption and misuse of official position by former telecom minister Dayanidhi Maran. The application said that though it is a “clear-cut case of corruption and quid pro quo” against Maran,the agency is making the case weak. “Chargesheet should have been filed in this case several months back,” it said.

Though Bhushan insisted that a full investigation report be submitted on the Maran issue,the bench sought to temper the attack by asking him to wait till the perusal of the probe agencies’ responses.

The application also raises doubts on the role of Shyam Telelink Ltd,which had applied for all 21 UAS licences despite not meeting the net worth requirement.

“Its (Shyam Telelink) own net worth was Rs 156.58 crore whereas the requirement was for Rs 1,380 crore. As per the DoT’s guidelines for issuing licences,the net worth of ‘only those promoters/shareholders was to be counted who have at least 10 per cent equity stake or more in the total equity of the applicant company’,” Bhushan read out from the application.

He said a Russian company Sistema’s equity in the company was declared “in haste” to be 10 per cent,so that Sistema’s net worth was also counted. “However,the fact is that as on the date of application,Sistema did not have any stake in the company,and the equity money was also not transferred,” the application alleged,adding that the investment pattern into the company by Sistema and the Russian government also raises doubts about the actual transactions,which need to be investigated by the ED.

The application also seeks a probe into the role of Allianz Infratech (P) Ltd,which had applied for licenses on September 6,2007,could obtain licenses in two circles — Madhya Pradesh (Rs 17.45 crore) and Bihar (Rs 10 crore).

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