Airtel, Vodafone hastily given extra spectrum: CBI

Says allocation in 2002 led to a loss of Rs 508 crore to the exchequer

The Central Bureau of Investigation (CBI) has said incumbent telecom operators Bharti Airtel (earlier known as Bharti Cellular) and Vodafone India (earlier known as Hutchison Max & Sterling Cellular) were given additional spectrum beyond 6.2 MHz, up to 10 MHz, in undue haste in January 2002.

It has said the allocation was done by the then communications minister, Pramod Mahajan, in association with some officers in the DoT (department of telecom) bypassing the opinions of the member (finance), the wireless adviser and even the highest decision-making body in the DoT, the Telecom Commission, which must clear all key decisions.

A presentation by the CBI to a Joint Parliamentary Committee last week said the decision led to a loss of Rs 508 crore to the exchequer.

Both Bharti Airtel and Vodafone India, when contacted, declined to comment on the issue.

The move is significant as it is the first evidence of the 2G scam investigation looking at decisions taken by the NDA government before 2008. It is also the first time the CBI is close to finalising action against telcos that were incumbents before licences were given in 2008. The 2008 licences have till now been the focus of the scam.

The CBI in its presentation has said additional spectrum beyond 6.2 MHz (and up to 10 MHz) was charged at an incremental one per cent of the adjusted gross revenue (AGR). However, based on precedents, allocation of additional spectrum over 6.2 MHz would have involved spectrum charges of four per cent of AGR and that over eight to 9.8 per cent five per cent of AGR. However, the DoT charged four per cent for the entire spectrum from 6.2 MHz to 10 MHz, leading to a loss in revenue to the government, according to the CBI. Undue favour was shown by some DoT officials to some telecom operators, the agency has said. The CBI has also said a technical committee report of the DoT in November 2001 recommended 6.2 MHz spectrum was enough in Delhi and Mumbai for another 12-24 months if the networks were planned optimally. That meant there was no need to hurry the grant of additional spectrum. That report was bypassed by the DoT. CBI investigations have revealed Shyamal Ghosh, the DoT secretary then, bypassed the wireless advisor, saying he was retiring the same day. And, the Telecom Commission member was bypassed on the pretext he was out of office. But, the officer was available in office till afternoon that day, according to the CBI. The final approval was given by the then communications minister, Pramod Mahajan.

The CBI has said about 50 witnesses have been examined and investigating officers have submitted their report, which is under legal scrutiny and examination by other officers. The investigation of these telecom operators, not part of the telcos given licences in 2008, will be completed by August.

The agency had, in November last year, also named Bharti Cellular and Hutchison Max & Sterling Cellular in an FIR for alleged irregularities in spectrum allocation. That time, the tenure of Pramod Mahajan as the telecom minister during the NDA regime had come under attack. The investigating agency carried out raids on the premises of Bharti Airtel and Vodafone India across Delhi, Gurgaon and Mumbai. It registered a case pertaining to the allocation of excess spectrum to the two telcos in 2001-02.