India charges Reliance Telecom, Unitech, Swan Executives on spectrum sale

FE Team | Published: April 04, 2011 00:00:00 | Updated: February 01, 2018 00:00:00

MUMBA, Apr 3 (Bloomberg): Executives of three Indian companies, including billionaire Anil Ambani's Reliance business group, and a former telecommunications minister face charges over a sale of second-generation mobile phone spectrum. Investigators filed charges yesterday, setting the stage for trials in what may be India's biggest case of political corruption. Prime Minister Manmohan Singh agreed in February to a parliamentary probe of the license sales, after opposition protests paralyzed legislation. "If licenses are canceled, then spectrum could suddenly become available again, and that would definitely help the sector," said Kunal Bajaj, head of Analysys Mason India Pvt., a telecommunications strategy consultancy in New Delhi. "Everybody agrees and recognizes that there's just way too many companies out there, and some amount of M&A needs to take place. To trigger that, you need this regulatory debacle to be sorted out." Former telecommunications minister Andimuthu Raja, his personal secretary R.K. Chandolia, former telecommunications department secretary Siddhartha Behura, former DB Realty Ltd. Managing Director Shahid Balwa, DB Realty Managing Director Vinod Goenka and Unitech Ltd. (UT) Managing Director Sanjay Chandra, were among those charged by the Central Bureau of Investigation yesterday, as well as Reliance ADA Group Managing Director Gautam Doshi and Senior Vice Presidents Hari Nair and Surendra Pipara. The companies charged were Reliance Telecom Ltd., Unitech Wireless and Swan Telecom Pvt., A.K. Singh, a government lawyer, said outside a court in New Delhi. A Reliance ADA Group e-mailed statement said its three employees deny the charges and have a legal presumption of innocence pending the completion of a trial. Unitech spokeswoman Tanuja Kehar and DB Realty's Goenka said they couldn't immediately comment on the charges. Balwa hasn't done anything "inappropriate or illegal," DB Realty said in a statement to the Bombay Stock Exchange on March 29. Raja has previously denied any wrongdoing. Raja resigned in November, two days before the nation's chief auditor said in a report that the second-generation airwaves were sold in 2008 for an "unbelievably low" $2.7 billion, causing a loss of as much as 1.4 trillion rupees ($31.4 billion) to the nation. Raja, his personal secretary and an ex- bureaucrat were arrested in February. Raja and the other former government officials were charged under the Prevention of Corruption Act. The company officials and companies were charged with "lesser offenses" under statutes relating to conspiracy, cheating and forgery.