CAG Report Indicts Raja and Anil Ambani

[Himanshu Singh 19]

The Govt tabled the CAG report which has indicted Anil Ambani for having a stake in Swan Telecom violating the ban on cross-holding of stake more than 10%.. Anil Ambani already owned a telecom company and he can have stakes in another telecom company only upto 10% of the total worth of the company.. But he held a larger stake in Swan and dint disclose it when Swan applied for licenses..

Also Anil Ambani was favoured for his gsm license as his bank draft for surety was dated prior to the announcement by the minister for paying the surety.. What this means is that Anil already knew of the minister's move.. We should remember that Rcom was the first company to pay the bank guarantee on the evening when Raja announced the decision..

Bad days for Raja and Anil.

[_Kailash_ 63]

The Govt tabled the CAG report which has indicted Anil Ambani for having a stake in Swan Telecom violating the ban on cross-holding of stake more than 10%.. Anil Ambani already owned a telecom company and he can have stakes in another telecom company only upto 10% of the total worth of the company.. But he held a larger stake in Swan and dint disclose it when Swan applied for licenses..

Also Anil Ambani was favoured for his gsm license as his bank draft for surety was dated prior to the announcement by the minister for paying the surety.. What this means is that Anil already knew of the minister's move.. We should remember that Rcom was the first company to pay the bank guarantee on the evening when Raja announced the decision..

Bad days for Raja and Anil.

Yes Anil Ambani Has a stake of 10.7% lolz

[rajanmehta 4,056]

Anyone interested to read the full CAG Report on 2G Licenses, Here is the link to CAG Site http://www.cag.gov.in/

It is on the homepage mentioned as Report No.19 of 2010-11 - Issue of Licences and allocation of 2G Spectrum by the Department of Telecommunications

[MOBILE FAN 42]

And I thought, Anil lost his clout after split from Mukesh.

[SUDYEcaZ 67]

Three key points;

the first is Reliance Communications being named in the context of Swan Telecom getting licence. Swan Telecom eventually sold a portion of its equity to Etisalat and Etisalat being a company which is independently investigated by the likes of the CBI and the Enforcement Directorate.

In that context the CAG says that undue advantages benefits were shown to Reliance Telecom, to Reliance Communications both through the grant of the licence to Swan Telecom in which Anil Ambani Group had 10.7% stake before it was granted a license essentially violating the norm.

The normsays that any company which has an interest in telecom licence cannot have more than 10% in another company. But Reliance has later on clarified that at the time of granting of licence to Swan it had less than 10% stake.

Essar Group

The second thrust of this report with respect to corporate and companies is that a dual technology licence that was issued on the same day of announcement of the policy was given again to Reliance Communications.

The CAG faults the DoT for doing that so in terms of the corporate impact Reliance Communications being put right up there followed by a little known company called Loop Telecom.

Originally called as shippingstop.com, Loop Telecom had similarly violated in principle of the 10% norm by the Essar Group. The Loop Telecom is again a company which has a licence is investigated by various agencies has not started Pan India operation, that is second, so Reliance being one, Essar being two.

Unitech Group

The third attack if I may say so in the CAG report is on the Unitech Group. Unitech Group got a nationwide licence of which it sold equity later on to a Norwegian company and it is now called Uninor.

Telenor is the major foreign investor in that. The report says that Unitech had applied through six group companies; real estate companies are not eligible for the grant of this licence. So in some ways the total loss being put at a notional loss of Rs 140,000 crore.

http://www.moneycontrol.com/news/news/2g-spectrum-scam-contourscag-report_499693.html

[Arun 795]

Reliance Communications on CAG report: Didn't violate licence conditions

NDTV Correspondent

November 16, 2010

Contesting the claim of government auditor CAG, Reliance Communications, India's second-biggest mobile operator, on Tuesday said it didn't violate licence conditions at any stage.

"The group has had no shareholding in Swan Telecom Ltd. (now known as Etisalat DB Ltd.) at the time of grant of license to them or any time thereafter and the issue is accordingly not relevant to the company," RCom said in a statement.

"Reliance Communications has always been in full compliance with all applicable laws, rules and regulations, and there has been no violation of our license conditions at any stage on account of cross-holdings in excess of 10 per cent," the statement added.

The latest revelations on the 2G spectrum scam suggest a careful confluence between the Telecom Ministry, when it was headed by A Raja, and a series of big business houses.

"85 of the 122 licenses were issued to companies which suppressed facts, disclosed incomplete information and submitted fictitious documents to DoT and thus used fraudulent means of getting licenses and thereby access to spectrum" – this is one of the more biting conclusions of the report prepared by the government's auditor, the Comptroller and Auditor General (CAG).

It is unflinching in its indictment of Raja, blaming him for violating guidelines, indulging in favouritism and costing the government Rs. 1.76 lakh crore by mishandling the allocation of 2G spectrum in 2008.

"2G spectrum was allocated beyond contracted quantity to 9 firms including Bharti, Vodafone, Idea, BSNL, Reliance, Aircel," the report said.

It says that the Department of Telecommunications (DoT) circumvented the rules to help Swan Telecom, which effectively acted as a front for Reliance Telecommunications. The charges in the CAG report are that Swan should not have been considered for a license because Reliance Communications held 10.7 per cent stake in Swan - and according to the rules, a telecom operator cannot own more than 10 per cent stake in another telecom company operating in the same service area. "Email ID of Swan Telecom was shown as that of a Reliance ADA group official," said the report.

Shares of the company declined Rs. 6.25, or 3.72 per cent on Tuesday, to settle at Rs. 161.80.

Read more at: http://profit.ndtv.c...tions-122309?cp

[kalpeshaparmar 66]

Reliance Communications on CAG report: Didn't violate licence conditions

NDTV Correspondent

November 16, 2010

"2G spectrum was allocated beyond contracted quantity to 9 firms including Bharti, Vodafone, Idea, BSNL, Reliance, Aircel," the report said.

Read more at: http://profit.ndtv.c...tions-122309?cp

It's true it was given to them for free but there is bond signed with them that whenever the price was decided for the extra spectrum they have to pay for it..........

Which this company agreed and now there is a case going on in Court regarding this as the Benchmark for Spectrum has been of 3G prices............

[kesav 127]

Initial flipping over the report brings out the following facts

(1) The only meaningful faults identified are the change in the procedure from 'pure FCFS' to 'FCFS based on meeting LOI conditions' and some invalid applications at the time of grant of licenses

(2) Report is basically targeted against the minister by puposely trying to shield bureacrats(category to which CAG belongs) in the DoT. This kind of personal attack instead of issue based attack is unprecedented in the history of functioning of constitutional institutions like CAG

(3) Most of the figures are just hypothetical calculations based on 3G auctions without understading the technology difference and the circumstances which led to high price of 3G

(4) CAG has tried to shield itself from attack of the public by giving token appreciation for PM although everyone knows the whole scenerio of telecom was always there in the table of PM

Further analyis to follow.....

[kesav 127]

PM asks CAG to distinguish between bonafide errors and deliberate mistakes

Prime Minister Manmohan Singh said today that the comptroller & auditor general (CAG) of India should exercise extreme caution on the accuracy, balance and fairness of its reports. The Prime Minister, who was addressing the 150th anniversary celebrations of CAG, said its reports were taken very seriously by Parliament. He urged CAG to distinguish between "bonafide errors and deliberate mistakes".

source :: http://www.business-standard.com/india/news/pm-lectures-cag-sc-lectures-pm/415164/

New Delhi, Nov.16 (ANI): The Prime Minister, Dr. Manmohan Singh on Tuesday said the institution of the Comptroller and Auditor General (CAG) has to further enhance its capabilities and its skills and re-orient itself to deliver results that our nation expects of it in the years that lie ahead.

Buzz up!Addressing the gathering at the inaugural function of the celebrations of 150th anniversary of the institution of Comptroller and Auditor General of India in the national capital, Dr. Singh said: "The reports of the Comptroller and Auditor General are taken very seriously by the media, by the public, by the government and by our Parliament. This casts a huge responsibility on the institution to ensure that its reports are accurate, balanced and fair."

President Pratibha Devisingh Patil inaugurated the celebrations.

Dr. Singh hailed the institution of CAG and congratulated all those who are associated with the institution.

"The institution has served our country very well as an independent, competent and credible audit institution. I congratulate all those who have been associated with this institution for their solid achievements," said Dr. Singh.

He also said that concerns regarding the inadequate and delayed response to the reports of the CAG, the Ministry of Finance has taken a number of initiatives which will lead to an improvement in this area.

The Prime Minister also said the benefits of detailed propriety audit cannot be under-estimated.

"There is a case for allocating limited time and resources in a manner that big and systemic issues get due attention and we get much greater value for money spent," said Dr. Singh.

He also mentioned two developments, which have altered the patterns of spending public money phenomena.

The first being the progressive devolution of powers and resources to the Panchayati Raj Institutions and the other development is the increasing number of Public Private Partnership projects both in the Centre and in the States.

Dr. Singh also hoped that with time, Public Private Partnership would be increasingly used in diverse areas.

"There is a need to improve the structure of Public Private Partnership arrangements to ensure that they are transparent, ensure adequate competitiveness and adequately safeguard the public interest. I expect that the Comptroller and Auditor General will play a leading role in ensuring that these new initiatives deliver as intended," said Dr. Singh.

The Prime Minister showed great faith in the institution and acknowledged the contribution made by the CAG and the Indian Audit and Accounts Service in ensuring accountability in the processes of government.

"I have great faith in this institution and I expect it to pay its rightful role in our efforts towards a prosperous and equitable future for our people," said Dr. Singh.

source :: http://news.oneindia.in/2010/11/16/caghave-to-further-enhance-its-capabilitiesskills.html

Edited November 18, 2010 by kesav

[sgiitk 32]

SCAM gets deeper

Seems that in 2006 Dayanidhi Maran told the PM to lay off the spectrum pricing. Obviously a case of Delhi Money for Karunanidhi calling the shots. I thought Dayanidhi was somewhat honest!

[csmart 472]

@sgiitk no politician is "pure".. dayanidhi was better than Raja. while favoring telcos, he was also making sure that govt does not loose anything. look at current state of BSNL, once goldmine, now bleeding. dayanidhi had also suggested to directly opt for 4G instead of 3G.. and from that time onwards, he was opposed..

besides, spectrum, Raja has ordered for 2G devices for BSNL immediately after his appointment so that BSNL could not roll it out b4 other telcos. the spectrum allocated to BSNL & MTNL for 3G much before other telcos. but they were not allowed to upgrade their network. this resulted in heavy loss and also could not materialize the benefit.

Edited November 19, 2010 by csmart

[ACS 130]

@sgiitk no politician is "pure".. dayanidhi was better than Raja. while favoring telcos, he was also making sure that govt does not loose anything.

But i feel Kapil uncle will do a good job if he sticks to this..

DMK buggers cannot be trusted anymore in telecom.. they're now veterans in looting telecom dept.

[Karthik R 246]

To sum up, 'Congress once a party of rationalist, progressive ideals, it's now hard to find any consistent principle in its choices apart from power-mongering. Once a party of movement, run by committed cadres, it has become a family huddle, an organisation that turns to the dear leader at every step. And while there might be persuasive reasons for the DMK's tumult, and Karunanidhi is certainly under pressure to manage the different power centres in his party, their private familial transactions cannot hold up the rest of the country'.