Majority of the 2G licenses issued in 2008 are illegal

By siliconindia   |   Monday, 27 September 2010, 15:05 IST   |    7 Comments
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Majority of the 2G licenses issued in 2008 are illegal
Bangalore: The Comptroller and Auditor General (CAG) have informed the Department Of Telecom (DoT) that a vast majority of the 126 licenses controversially issued by the government in 2008 are illegal. CAG wrote to DoT in the second week of September that more than 75 licenses issued in the 2G spectrum allocations have violated several of the guidelines for granting Unified Access Services License in a Service Area. These guidelines were issued on December 14, 2005 by DoT. These licenses were awarded to companies that did not meet several of the basic criteria laid down under the license conditions. It is indicating that out of nine companies five of them had no experience in the telecom sector pocketing precious spectrum at throwaway prices. Among those indicted by CAG in its latest communication are Unitech, Loop, Swan, Datacom and Allianz Infra. Through various companies floated by them, together they hold over 75 of the total 126 licenses given by the government without an auction. Some estimates have calculated the loss to the exchequer because of this sale in the region of 60,000 crore. The CAG findings now go beyond the issue of auction, and highlight the fact that DoT did not ensure that the companies adhered to its own guidelines. Raja had recently managed a law ministry opinion that CAG cannot question government's policy decisions, but the latest findings show that his department did not even carry out basic due diligence. The sensational audit finding will further complicate the situation for the UPA government as Supreme Court begins to monitor investigations into the allocation of 2G spectrum under the stewardship of telecom minister A Raja in January 2008.