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CBI expands probe to pre-2007 licences

To look into adjusted gross revenues given by licensees for spectrum beyond 8 MHz

Surajeet Das Gupta  |  New Delhi 

In its next big step in the 2G probe, the Central Bureau of Investigation (CBI) will now look at telecom companies that were granted licences before 2007. The investigating agency has sought from the Department of Telecommunications (DoT) the details of adjusted gross revenues, provided by unified access service licensees for all circles and operators, for additional spectrum of above 8 MHz, from 2002-03 to 2007-08.

Under the new telecom policy announced by the government, the maximum prescribed amount of spectrum for GSM operators has been fixed at 8 MHz in all circles and 10 MHz in Delhi and Mumbai. This had earlier been endorsed by the regulator.

DoT has already responded by providing details for Bharti Airtel (in Delhi, Mumbai and Tamil Nadu, including Chennai), Vodafone (Delhi, Mumbai, Kolkata and Gujarat), Idea (Maharashtra), Loop (Mumbai) and Aircel (Chennai and Tamil Nadu). In all these circles, the operators were allotted spectrum beyond 8 MHz.

Bharti Airtel, Vodafone and Idea did not respond to a query from Business Standard.

UNDER THE SCANNER            Telcos given more than 8 MHz
Company  Service area*  Quantum
(in MHz)
Year of
Bharti Airtel     Delhi    10.0 2003
Bharti Airtel    Mumbai   9.2 2006
Bharti Airtel  Tamil Nadu**  8.6 2006
Vodafone Delhi  10.0 2003
Vodafone   Mumbai 10.0 2003
Vodafone   Kolkata  9.8 2006
Vodafone Gujarat  9.8 2005
Idea Maharashtra 9.8 2005
BPL Mobile (Loop) Mumbai  10.0 2004
Aircel Chennai 8.6 2006
Aircel  Tamil Nadu 9.8 2004
*Spectrum beyond 8 MHz was given  **Including Chennai       Source:  DoT 

Also, CBI has asked DoT to work out the amount involved — if revenue charges on account of additional spectrum beyond 8 MHz would have been charged from operators at five per cent from 2002-03 to 2007-08.

The prevailing revenue share for telecom companies during the period under investigation was pegged at four per cent for 6.2-8 MHz as well as 8-10 MHz of spectrum, with no differential rates. Only those with more than 10 MHz spectrum were charged at five per cent.

DoT has said the difference — if the rate was pegged at five per cent instead of four per cent — is Rs 508.22 crore. In other words, the government would have earned this additional revenue if its share had been pegged at five per cent. CBI had said — while filing an FIR (first information report) against some of these companies — the decision of allocating additional spectrum had caused a loss of Rs 508 crore to the exchequer during 2001-07.

The investigations are in response to a December 2010 Supreme Court directive that had asked CBI to look into any irregularity in the grant of licences between 2001 and 2007, with an emphasis on the loss caused to the exchequer and corresponding gain to licensees.

Accordingly, CBI had registered a preliminary enquiry in January 2011.

The agency had, in November last year, also named Bharti Cellular (now Bharti Airtel), Hutchison Max & Sterling Cellular (now Vodafone Essar) in an FIR for alleged irregularities in spectrum allocation. This time, the tenure of Pramod Mahajan as the telecom minister during the National Democratic Alliance (NDA) regime came under attack.

The investigating agency carried out raids on the premises of Bharti Airtel and Vodafone Essar across Delhi, Gurgaon and Mumbai. It registered a case for allocation of excess spectrum to the two telcos in 2001-02.

After the five-year NDA rule, the United Progressive Alliance government came to power in 2004. According to the estimates of the Comptroller and Auditor General, the 2G scam under A Raja as the telecom minister allegedly caused a presumptive loss of Rs 1.76 lakh crore to the exchequer.

First Published: Fri, March 02 2012. 00:02 IST