2G scam: Reliance ADAG entirely funded Swan Telecom, says CBI

The CBI today told a special court that Reliance ADA Group had made the entire funding for Swan Telecom Pvt Ltd (STPL), one of the accused firm in 2G spectrum allocation case, in an alleged violation of stipulated rules.

The agency said that the Group made the fundings through a "circuitous route" when STPL had applied for 2G licences in 14 telecom circles across the country.

STPL and its promoters, Shahid Usman Balwa and Vinod Goenka, and three top executives of Reliance ADAG -- Gautam Doshi, Surendra Pipara and Hari Nair -- are facing trial in the 2G spectrum case along with ex-Telecom Minister A Raja, DMK MP Kanimozhi and others.

In its charge sheet, CBI has alleged that Reliance Telecom Ltd (RTL) had used STPL, an ineligible firm, as front company to get the 2G licenses and the costly radio waves.

All the accused had denied allegations levelled against them by CBI.

Advancing the final arguments in the case, special public prosecutor Anand Grover told Special CBI Judge O P Saini that whole funding was done by Reliance ADAG and the transactions were "disguised" as they were not genuine.

"STPL had applied for licences in 14 telecom circles. Our case is that whole funding was done by Reliance ADAG," Grover said.

He further argued that transactions between Reliance ADAG firms, STPL and other companies were not genuine.

"It (transactions) was disguised. It was done to increase the paid up capital of STPL," he said.

"Reliance ADAG is a listed company and the way it invested in STPL showed that it was not genuine. STPL was one of its group company. It was not prudent business transactions," he said.

He also said, "The transactions were done in a circuitous route deliberately and most of the companies involved in it are Reliance ADA group firms."

The arguments remained inconclusive and would continue on November 2.