Not involved in 2G scam, says Essar | delhi | Hindustan Times
Today in New Delhi, India
Mar 23, 2017-Thursday
New Delhi
  • Humidity
  • Wind

Not involved in 2G scam, says Essar

delhi Updated: Dec 12, 2011 21:29 IST

After the CBI on Monday accused the Essar Group of using Loop as a front company to acquire telecom licenses in 2008, the group said the charges were not related to corruption or involvement in the 2G scam, but of violating operational guidelines.

The Central Bureau of Investigation (CBI) on Monday filed the third set of formal charges in the second generation (2G) spectrum allocation case -- this time alleging criminal conspiracy and forgery by three firms and five people, including some promoters of Essar group.

The fresh set of charges holds that the Essar Group used Loop as a front company to acquire telecom licenses in 2008. Essar, which already had a 33% stake in Vodafone, held substantial equity in Loop and thus violated telecom license norms, the charges said.

The three companies named in the documents are Essar Teleholdings, Loop Telecom and Loop Mobile India, while the five individuals are Essar Group's Anshuman Ruia, Ravikant Ruia and Vikas Saraf, and the promoters of Loop, Ishwari Prasad Khaitan and Kiran Khaitan.

However, the Ruias-promoted group said the charges brought by the CBI proved that it was not involved in the 2G irregularities.

"The only charge filed by CBI is regarding the interpretation of a contractual license. This relates to the question of clause 8 of the UASL guidelines," the group said in a statement. Clause 8 bars cross-holding beyond 10%.

The group alleged that the investigating agency and the attorney general had gone ahead with the framing of charges despite the ministry of corporate affairs and ministry of law confirming that there was no violation of clause 8.

"Similar contractual violations in the past have not attracted any fine or penalty or charges by the government," statement said.

Loop Telecom had started operations in 1995 as BPL Mobile, which was then promoted by TPG Nambiar. The shareholding underwent a change in 2005 after the acquisition of its ownership by the Khaitans. The name was also changed to Loop.

The charges were filed in special CBI court, presided over by Judge OP Saini in the presence of around 100 witnesses. The judge is to examine the matter on Dec 17 and then decide whether to take cognizance of the charges.

"We would like to reiterate that Essar has complied with all conditions of clause 8 under UASL guidelines in totality and all the facts which have been given at the time of submitting the application for telecom licence," the statement added.