The 2G spectrum scam in India involved the issue of 122 licenses by the ruling Congress -led UPA alliance

of the 2G spectrum to 85 companies including many new telecom companies with little or no experience in the telecom sector at a price set in the year 2001. The scam involved allegations regarding  the under pricing of the 2G spectrum by the Department of Telecommunications which resulted in a heavy loss to the exchequer, and  the illegal manipulation of the spectrum allocation process to favour select companies
[1]

[1]

The issue came to light after the auction of airwaves for 3G services which amounted to 67,719 crore (US$15.1 billion) to the exchequer . A report submitted by the Comptroller and Auditor Generalbased on the money collected from 3G licenses estimated that the loss to the exchequer due to under pricing of the 2G spectrum was 176,379 crore (US$39.33 billion)[3]. The scam came to public notice when the Supreme Court of India took Subramaniam Swamy's complaints on record [With Case type:Writ Petition (Civil),Case No:10, Year:2011] .
[4] [2]

Civil Servants, Politicians and Corporations Involved in scam All the accused have been booked under sections 120(B) (criminal conspiracy), 468 (Forgery for purpose of cheating), 471 (using as genuine a forged document or electronic record), 420 (cheating and dishonestly inducing delivery of property) and 109 (abetment if the act abetted is committed in consequence, and where no express provision is made for its punishment) of the Indian Penal Code.[5]
[edit]Politicians, 

Ministers and Parliamentarians involved

Andimuthu Raja, Union Cabinet Minister for Communications and Information Technology : The Comptroller and Auditor General holds Raja personally responsible for the sale of 2G spectrum at 2001 rates in 2008, resulting in the previously mentioned loss of up to Rs. 1.76 lakh crores (US$40 billion) to the national exchequer.[6] In August, 2010, evidence was submitted by the Comptroller and Auditor General (CAG) showing that Raja had personally signed and approved the majority of the questionable allocations.[7] Kanimozhi Aravindhan, Member of Rajya Sabha : On April 25, 2011 Kanimozhi was named as a co-conspirator in the supplementary chargesheet filed by the Central Bureau of Investigation(CBI) in connection with the 2G spectrum case. The chargesheet submitted before the Supreme Court establishes how Rs 200 crore connected with the scam

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Subramaniam Swamy, activist lawyer and politician, whose letters to the Prime inister demanding action and affidavits and cases in the Supreme Court brought the issue into the public limelight.  Paranjoy Guha Thakurta, a journalist who was one among the very first to write on the irregularities in the awarding of 2G spectrum allocation by the Telecom inistry. e is also one of the petitioners in the 2G PI currently being heard in the Supreme court.[18]  Prashant Bhushan, on behalf of the Centre for Public Interest itigation.  Anil Kumar, on behalf of the civil society organisationTelecom Watchdog  Others:Several eminent people like former chief election commissioners . . yngdoh, T.S. Krishnamurthy and . Gopalaswami and former central vigilance commissioner (CVC) P. Shankar are also petitioners in the suits filed by civil society groups.[14] [edit] oss to Exchequer


The Controller and Auditor General of India used three different methods to assess the presumptive loss to the exchequer resulting from not auctioning 2G spectrum.[19] The first method was based on the fact that S Tel, one of the licensees, explicitly offered to pay significantly higher license fees for the spectrum. Based on the fees offered by S Tel, the CAG estimated the loss to the exchequer at 67,364 crore (US$15.02 billion) The second method was based on the price recovered by the 3G auction in 2010. The CAG reasoned that since 2G is really 2.75G (EDGE), its price should be comparable to that of 3G licenses. Based on this method, the CAG estimated the loss to the exchequer to be 176,000 crore (US$39.25 billion) The third method was based on the fact that some of the licensees received FDI in the form of equity, shortly after the spectrum allocation. The CAG reasoned that this equity infusion was entirely due to the value of the allocated spectrum; this can be construed as re-sale of the spectrum by the licensee, and hence was a valid basis for assessing loss to the exchequer. Based on this method, theCAG estimated the loss to the exchequer to be anywhere between 57,666 crore (US$12.86 billion) (based on Etisalat's investment in Swan Telecom) and 69,626 crore (US$15.53 billion) (based onTelenor's investment in Unitech).

For it rt, t ongress-part led government as publi l defended itself on t is ount and Kapil Sibal, o replaced A. aja as t e communication minister, as refuted t e A reasoning.[ ] He as also justified is government s decision not to auction spectrum as being in line it t e policy guidelines laid down by t e t Five-Year Plan.[ ][ ]
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elationship between media and government

ira Radia tapes ntroversy

Main arti le:

Media sources such as PEN and utlook reported that Barkha utt and Vir Sanghvi knew that corporate lobbyist Nira adia was influencing the decisions of A. aja.[ ] he critics alleged that utt and Sanghvi knew about corruption between the government and the media industry, supported this corrupt activity, and suppressed news reporting the discovery of the corruption.[ ]
[edit]Ratan

ata petitions over leak

The tapes leaked to the public include conversations between Nira adia and atan Tata. Tata petitioned the government to acknowledge his right to privacy and demanded accountability for the leak, with the Minister for Home Affairs, BI, Indian Income Tax epartment, the epartment of Telecommunication, and the epartment of Information Technology as respondents in the petition.[ ] n April , Indian Parliament s Public Accounts ommittee PA uestioned Tata Sons hairman atan Tata and corporate lobbyist Niira adia regarding their roles in Scam.[ ]
[edit]

esponse to scam Telecom Minister A aja resigned.

In early November

In mid November the controller Vinod ai issued show-cause notices to nitech, S Tel, Loop Mobile, atacom Videocon), and Etisalat to respond to his assertion that all of the licenses granted to these companies did not have the up-front capital required at the time of the application and were in other ways illegal.[ ] Some media sources have speculated that these companies will receive large fines but not have their licenses revoked, as they are currently providing some consumer service.[ ] In response to the various allegations, the ovt of India has replaced the then incumbent Telecom minister, A. aja with Kapil Sibal who has taken up this charge in addition to being the nion minister for Human esources
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Development.Mr Sibal contends that the "notional" losses quoted are a result of erroneous calculations and insists that the actual losses are nil.[ ][ ] The BI conducted raids on aja and four other telecom officials - former telecom secretary Siddharth Behura, aja's personal secretary K handolia, member telecom K Sridhar and DoT deputy director general A K Srivastava on December .Kanimozhi, DMK MP and Karunanidhi's daughter, was arrested and sent to Tihar jail by a Delhi court which dismissed her bail plea in the spectrum scam, saying there was a possibility of witnesses being influenced considering the "magnitude" of the crime..[ ]
[edit]Arrests

and hargesheets

n February , , the entral Bureau of Investigation arrested former Telecommunications nion Minister Andimuthu aja. The BI also arrested .K. handolia, aja's personal aide, and Siddharth Behura, the former Telecom Secretary.[ ][ ] Both aja and handolia are heard in conversation with Niira adia in the released adia tapes. n February , , the BI arrested Mumbai based Dynamix Balwas DB) group managing director Shahid sman Balwa in connection with the spectrum allocation scam. The BI has evidence from the Income Tax department that Shahid sman Balwa, considered close to aja, was instrumental in channelling the kickbacks allegedly received by the former telecom minister.[ ] n March , , in Delhi, the BI arrested Asif Balwa younger brother of the arrested former Managing Director of DB-Etisalat roup, Shahid Balwa) and ajeev Agarwal for their alleged involvement in money transfer to the Dravida Munnetra Kazhagam's DMK) Kalaignar TV channel.[ ] n April , , the BI filed its first , page chargesheet in the spectrum scam before a Special ourt in Delhi naming nine individuals and three companies. It said the wrongful acts of the accused deprived the government exchequer of possible revenues amounting to IN s , , , , ). The accused include the following individuals:[ crore SD . Andimuthu aja, former Telecom minister . Siddharth Behura, former Telecom Secretary . .K. handolia, aja's former personal secretary . Shahid sman Balwa, former Director of Swan Telecom now Etisalat DB)
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5. Sanjay handra, Managing Director of nitech Ltd and nitech Wireless . autam Doshi, roup MD, eliance Anil Dhirubhai Ambani roup . Hari Nair, Senior Vice-President, eliance Anil Dhirubhai Ambani roup . Surendra Pipara, Senior Vice-President, eliance Anil Dhirubhai Ambani roup and eliance Telecom Ltd . Vinod oenka, Director, Swan Telecom now Etisalat DB) The three companies named are: . Swan Telecom . nitech Wireless . eliance Telecom In the first chargesheet, the others as witnesses. n 5 April Investigation BI had named lobbyist Niira adia and entral Bureau of

, in its second chargesheet in the scam, the BI) named five more accused individuals:[ ]
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. Kanimozhi - ajya Sabha Member of Parliament DMK) and daughter of Tamil Nadu ex-Chief Minister M Karunanidhi . Sharad Kumar of Kalaignar TV . Karim Morani of Cineyug Films . Asif Balwa of Kusegaon ealty 5. ajiv B Agarwal of Kusegaon ealty n May, , Special CBI Judge P Saini of the Delhi court ordered the arrest of DMK Member of Parliament Kanimozhi and Kalaignar TV Managing spectrum Director Sharad Kumar after rejecting their bail pleas in the [ ] case.
[edit]P.A.C.

Public Accounts Committee, a -member committee, with chairman as Murli Manmohar Joshi, was formed to investigate, independent of other committees like JPC. The chairman submitted a draft report on scam to Lok Sabha Speaker on Saturday -04-2011, and insisted that it be tabled in the Parliament. PA members' claimed that the report had been "rejected", and 11 MPs of same committee(majority out of 21) had "rejected" the report - which was termed as "unconstitutional" by MM Joshi pointing out that such a possibility does not exist till the report is "read" by members and "discussed" para by para. Defending his action of calling witnesses from diverse fields in

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connection with the 2G scam probe, Joshi said it was the duty of the PAC to "trace and examine the way the money of common man is spent". He alleged that on 28-04-2011, during the last meeting of the committee, ministers passed on "chits" and called up PAC members to speak and behave in a particular manner; that said trouble started when a decision was taken to call top officials of the PM , Cabinet Secretary, Attorney General and CBI director for questioning. A minister reportedly commented that the PAC draft report will be thrown in the dustbin, to which the chairman regretted and questioned if Parliament's proposals and then Supreme Court orders would be given the same treatment.[ 5]
[edit]Impact

on stock markets

The first casualty in Stock Markets once aja was arrested was DB ealty.[ ] 20% fall in the stock prices of DB ealty. Sun TV had its shares fall by 10%.[ ] Sun TV COO refused the allegations. Swan Telecom Chief Balwa was arrested on Feb 8 [ 8] and this led to rumours of links with Anil Ambani's eliance ADAG and it led to 20% fall of his stocks . Its reported that nearly 2 Billion SD was eroded from his stocks .[ ] Spicejet stocks went down after reports of investigation on Maran's recent takeover of Spicejet .[40]
[edit]See

also

        

List of politicians in India charged with corruption 2010 housing loan scam in India Adarsh Housing Society Scam Commonwealth games scam Indian political scandals Belekeri port scam Corruption Perceptions Index ent seeking Jan Lokpal Bill

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