Firms lied in 2G race, says CAG
Unitech, Essar and Videocon group companies are among 85 firms that got new 2G licences, even though they did not meet the criteria. Swan was also issued licence despite not meeting eligibility criteria.delhi Updated: Nov 16, 2010 21:56 IST
Unitech, Essar and Videocon group companies are among 85 firms that got new 2G licences, even though they did not meet the criteria. Swan was also issued licence despite not meeting eligibility criteria.
Of these, 13 companies, which had applied for 123 UAS licences and were granted 85, did not have requisite authorised paid up capital on the date of submission of applications, according to CAG. Further, 45 of these licenses were issued to companies that did not even meet the main object clause in their Memorandum of Association.
“Hence the question of their meeting eligibility criteria on the date of application did not arise,” the CAG observed.
“Many of these Companies suppressed facts, disclosed incomplete information and submitted false and fictitious documents for getting licences and thereby access to spectrum.”
The companies, however, refute these charges. “The CAG never approached us for any information,” claimed a promoter of a company that was issued nation-wide 2G licences. “They relied on information from some other sources including ministry of company affairs.”
“If they had approached us, we would have shown them all the documents proving that we met all the criteria,” he said. “We have not done anything wrong,” said Shahid Balwa, original promoter of Swan.
CAG has also said that Swan had more than 10% equity of Reliance Communications, which was already operating services in the country. Under licence guidelines, one company can not have more than 10% equity in two or more companies in a circle.
The Reliance spokesperson refuted this charge, saying “Our Group had no shareholding in Swan Telecom Ltd at any time, and that issue is accordingly not relevant to our company.