MCA sends probe report on Swan-RCom link to DoT

The corporate affairs ministry today said it had sent its report on Swan Telecom’s alleged connection with Reliance Communications to the Department of Telecommunications (DoT).

“The Registrar of Companies (RoC) has got back to us and that information has also been shared with DoT,” minister Salman Khurshid told reporters, when asked if the inquiry was over into the shareholding pattern of Swan, alleged to be a front company of RCom.

“We were not looking for irregularities, we were looking for the factual position. Whether that’s consistent or inconsistent with licensing conditions is for DoT to decide,” he said.

Last month, telecom minister Kabil Sibal said DoT would ask MCA to investigate the Comptroller and Auditor-General’s allegation that Swan, which got licences and spectrum in 2008, acted as a front company of RCom.

CAG had said Swan Telecom appeared to be acting as a front company for Reliance Telecom, a 100 per cent subsidiary of RCom. The rules say no telecom operator is allowed to hold more than 10 per cent stake in another service provider in the same circle, either directly or indirectly. In all 13 circles where Swan bagged licences, Reliance was already present.

The CAG has calculated that inclusive of preferential shares equivalent to a 0.9 per cent stake, RCom had a 10.71 per cent participating interest in Swan. Rcom has maintained it held a 9.9 per cent stake in Swan through Reliance Telecom till December 5, 2007, when it had offloaded the shares, prior to the award of a telecom licence to Swan on January 10, 2008.