24 MAR, 2012, 07.07AM IST, JOJI THOMAS PHILIP,ET BUREAU 
2G scam: Manmohan Singh and P Chidambaram approved mobile licences, Uninor tells Supreme Court

NEW DELHI: The Indian unit of Norway's Telenor has claimed that the controversial issuance of mobile licences by A Raja had the approval of leaders at levels higher than the incarcerated former minister, an assertion that could be seized upon by anti-corruption campaigners and Opposition parties looking to embarrass the embattled UPA government. 

Uninor, the Indian arm, has submitted documents to back these claims in a review petition, asking the Supreme Court to reconsider its February 2 order cancelling 122 mobile licences, including those held by it. The documents are intended to "prove that consensus had been arrived at the highest levels of the government between the Prime Minister's Office, finance ministry and telecom department in January 2008 to give out pan-India mobile licences at Rs 1,658 crore (a price fixed in 2001)", the review petition says. 

The documents, essentially correspondence and file notings by ministers and bureaucrats, are intended to rebut a part of the court's order that held Raja responsible for allocating mobile licences in a "totally arbitrary and unconstitutional manner" and concluded he was solely responsible for this. 

Chatterji Note, Chidambaram-Raja Meetings Cited 

The court has not said when it plans to hear the review petition, an overwhelming majority of which are rejected. Instead, Uninor has contended that the Indian government's "failure" to place relevant documents before the court had "impacted the very basis of the apex court's judgement" and added that the "discovery of new, important materials and evidence was an accepted ground for review". 



Telenor's Indian operation, with over 40 million customers, was one of the worst affected by the apex court's order to cancel licences issued by Raja. Almost all the documents cited by Uninor in its plea are in public domain. Nonetheless, acceptance by the court of any of the grounds cited by Uninor, when it considers the review plea, could cause fresh embarrassment to the government. 

Uninor has told the SC that just days before Raja issued letters of intent (LoIs) for new mobile permits, Prime Minister Manmohan Singh's then private secretary, Pulok Chatterji, in a note dated January 6, 2008, had said "new operators may be allotted spectrum only up to the threshold level on payment of the normal fees". 

The petition states Chatterji had acknowledged that the ideal situation was to auction airwaves, but did not advocate this on the grounds that "uncontrolled auction may lead to inflated high bids, unacceptably high prices for the customers and threaten financial stability of the industry". Chatterji's note states that this issue was discussed with the "new telecom secretary". The note was signed by the PM's then principal secretary, TKA Nair, on January 7. 

The existence of Chatterji's note was first reported by ET in its edition dated August 15, 2011. The petition has cited this note as "proof" that the policy followed by Raja had the implicit sanction of the highest authorities in the government. 

Uninor has also submitted a "secret communication" dated January 15, 2008, sent by then finance minister P Chidambaram to the prime minister, that had discussed the auction of 2G airwaves, but said this should not be applicable to start-up spectrum. It has further submitted documents describing the outcome of a meeting between Chidambaram and Raja, held on January 30, 2008, where the then finance minister had said "he was for now not seeking to revisit the current regimes for entry fee or revenue shares". 

The mobile phone company has also provided minutes of meetings on May 29 and July 4, 2008, where Raja and Chidambaram had only discussed pricing of airwaves beyond the start-up limit, to back its claims that both the ministries had jointly decided there would be no change in the Rs 1,651-crore entry fee. 

Uninor has also submitted a controversial note prepared by the finance ministry under Pranab Mukherjee (dated March 25, 2011), which said Chidambaram did not insist on an auction of airwaves during his discussions with Raja in 2007-08. This note had said the finance ministry under Chidambaram had "implicitly agreed to the imposition of the same entry fee as that prevailing in 2001 for licences allotted up to December 31, 2008', despite opposition from then finance secretary D Subbarao, now the RBI governor. It further added that there was a "consensus" between Raja and Chidambaram not to charge for start-up spectrum. 


The petition says the documents suggest the findings of the Supreme Court that the finance ministry was not consulted on pricing of spectrum before the issuance of licences were not correct. "Obviously, the Supreme Court, not having had the benefit of the documents, was guided by what was placed before it by the government of India. The impression with court is that the finance ministry was bypassed because of known objection of finance secretary in November 2007. The documents produced before the court present a different story of deliberations and thoughtful application of mind in the government of India to balance revenue maximisation with the public good of creating competition and affordable mobile phone services for mass usage," the telco said.

Following the SC order, Telecom Minister Kapil Sibal said the apex court had insulated the prime minister and Chidambaram from the policy decision on 2G licences in 2008, and argued that only Raja was responsible for the mess. "There is no indictment of the prime minister or the then finance minister (Chidambaram) in the Supreme Court's judgement. That is why Raja is where he is," he had said. 

Uninor, on the other hand, has argued that there was 'sufficient basis to demonstrate that "policy decision not to auction the licences was taken by the government of India in its collective wisdom" and has sought that the SC reconsider its views on the government's decision not to go in for an auction. 

Some of the documents cited by Uninor were used by politician and anti-corruption campaigner Subramaniam Swamy in his attempt to persuade a Delhi court to charge Chidambaram as a co-accused in the ongoing 2G trial. The court threw out Swamy's plea.
The petition says the documents suggest the findings of the Supreme Court that the finance ministry was not consulted on pricing of spectrum before the issuance of licences were not correct. "Obviously, the Supreme Court, not having had the benefit of the documents, was guided by what was placed before it by the government of India. The impression with court is that the finance ministry was bypassed because of known objection of finance secretary in November 2007. The documents produced before the court present a different story of deliberations and thoughtful application of mind in the government of India to balance revenue maximisation with the public good of creating competition and affordable mobile phone services for mass usage," the telco said.

Following the SC order, Telecom Minister Kapil Sibal said the apex court had insulated the prime minister and Chidambaram from the policy decision on 2G licences in 2008, and argued that only Raja was responsible for the mess. "There is no indictment of the prime minister or the then finance minister (Chidambaram) in the Supreme Court's judgement. That is why Raja is where he is," he had said. 

Uninor, on the other hand, has argued that there was 'sufficient basis to demonstrate that "policy decision not to auction the licences was taken by the government of India in its collective wisdom" and has sought that the SC reconsider its views on the government's decision not to go in for an auction. 

Some of the documents cited by Uninor were used by politician and anti-corruption campaigner Subramaniam Swamy in his attempt to persuade a Delhi court to charge Chidambaram as a co-accused in the ongoing 2G trial. The court threw out Swamy's plea.

http://economictimes.indiatimes.com/news/news-by-industry/telecom/2g-scam-manmohan-singh-and-p-chidambaram-approved-mobile-licences-uninor-tells-supreme-court/articleshow/12387325.cms

2G review: Has Uninor got it wrong and A Raja right?

by Kartikeya Tanna Mar 26, 2012

The spate of 2G judgments handed down in February this year have created a lot of confusion and misunderstandings, apart from a lot of disgruntled individuals and companies. It is little surprise that the Union government, the Prime Minister’s Office (PMO), Andimuthu Raja, Uninor and Subramanian Swamy have filed review petitions and/or appeals.

Even though these petitions and appeals have arisen from the same monumental 2G scam, each is discernibly different in nature, purpose and objective.



The petitions by the government of India and the PMO do not directly deal with the contentious issues on criminality of individuals like Raja and P Chidambaram. Issues raised in Swamy’s appeal against the order by Judge OP Saini, which exonerated Chidambaram, require an independent analysis. This article seeks to help clear some of the confusion prevailing with the two review petitions by Uninor and Raja and provide an assessment of likely outcomes. (Firstpost has used The Economic Times story on Uninor as the basis for what it may argue. The action petition is still to be admitted.)

Uninor’s review petition

In some ways, Uninor’s review petition seeks to reverse the constitutional remedy provided by the Supreme Court, ie, cancellation of 122 licences, by providing to the court evidence relevant in a criminal proceeding in a trial court – evidence regarding complicity of Chidambaram and the Prime Minister. This is probably inspired primarily by the Supreme Court’s entry into the realm of pinning down individual culpability in a decision which ought to have focused solely on the process.

As Firstpost has explained earlier, there is a very vital difference in the nature as well as the purpose of the two separate proceedings pertaining to the 2G scam.

The primary question before the Supreme Court in the constitutional matter was whether licences were granted by the Department of Telecom (DoT) in an arbitrary and unconstitutional manner, making them subject to cancellation. On the other hand, the question before the Special CBI court – and now the Supreme Court that will be hearing Swamy’s appeal against it – in the criminal proceeding against Chidambaram was whether he can be convicted for various criminal offences, primarily under the Prevention of Corruption Act 1988 (POCA).

Therefore, the Supreme Court’s focus was on the executive decision in deciding whether to cancel 122 2G licences, whereas the Supreme Court judges now hearing Swamy’s appeal will have to focus on the executor of that decision, ie, Chidambaram.

The reason why Uninor’s argument may lack a sound basis is clear from this vital difference. For the sake of an exaggerated assumption, if only to make a point, let us assume that the entire government of India was involved in the grant of licences in the manner they were so granted and can be put behind bars after a criminal trial. It still does not make the grant of licenses automatically constitutional. Uninor is essentially arguing that because the PM and the FM of the country assented to such a procedure as opposed to the telecom minister alone, its unconstitutionality must be ignored and reversed.

Indeed, at first glance, it may seem that Uninor has been deprived of the benefit of a valid contract independently entered into with a sovereign government having the authority to award licences. But, the principle of “sanctity of contract” cannot trump the Constitution of India. If the process under which licences have been granted is itself vitiated, arbitrary and unconstitutional, a court has no option but to annul such licences regardless of who (or how many) took the decision.

So, what recourse does Uninor have? Uninor may have a claim against the entity with which it had a contract – the government of India – for the loss it has suffered due to the arbitrary and unconstitutional process followed by that party to the contract which led to the grant of licences. However, if there is incontrovertible evidence that Uninor knew that the benefits flowing to it were a result of arbitrary and illegal process followed in the grant of licence, it is highly doubtful that a court of law would come to its rescue. Prashant Bhushan has stated in television interviews that telecom companies knew of the unconstitutionality in the process through which they obtained benefits.

A Raja’s review petition

Raja, on the other hand, has valid grounds to ask the Supreme Court to strike down some serious indictments against him in the order cancelling 122 licences, primarily because of the same reason where Uninor’s petition lacks grounds. However, what Raja is asking the Supreme Court in his review petition is to set aside its decision to cancel 122 licences altogether. That is highly unlikely due to the vital difference pointed out above.

At the most, the Supreme Court may strike down those paragraphs indicting Raja individually without affecting the cancellation of 122 licences – a partial strike-down of observations in the order.

The author of this article has argued aspects pertaining to Raja’s review petition at length in the Business Standard here. As explained above, Raja’s individual criminality has been taken by the Supreme Court as an additional basis for cancellation of 122 licences instead of basing its decision solely on the executive process alone, which would have been sufficient. And because the Supreme Court did not think it appropriate to hear Raja in doing so, it has resulted in a denial of natural justice given that such serious observations can prejudice the ongoing trial in the Special CBI court.

Kartikeya Tanna is a partner at Tanna Associates Advocates, Ahmedabad. He can be reached at kartikeya@tannaassociates.com.


A Raja may have something to cheer about

Kartikeya Tanna / Mar 12, 2012, 00:47 IST

A Raja has filed a petition in the Supreme Court to review the order cancelling 122 2G-licences which contained certain seriously indicting observations about his actions. Raja has argued that such observations violate principles of natural justice and judicial norms of fairness in as much as he was not given an opportunity to be heard. This, Raja asserts, is bound to prejudice his defence in the ongoing trial in the Special CBI court.

Under Supreme Court Rules 1966, a review petition is, as far as practicable, circulated to the same Bench of judges who delivered the order. Since Justice Ganguly has retired, Justice Singhvi will most likely be hearing this review petition with another judge.

At the outset, it may be useful to understand the vital difference in the nature as well as the purpose of the two proceedings. The primary question before the Supreme Court in the constitutional matter was whether licences granted by the DoT were so granted in an arbitrary and unconstitutional manner making them subject to cancellation. On the other hand, the question before the Special CBI court in the criminal proceeding is whether Raja and the other individuals who were a part of the licence issuance process can be convicted for various criminal offences, primarily under the Prevention of Corruption Act 1988 (POCA). Therefore, the Supreme Court’s focus was on the executive decision, whereas the Special CBI court’s focus is on the executors of that decision.
To practically explain this distinction, it is possible that the Special CBI court could acquit A Raja of all criminal charges brought against him despite the fact that the Supreme Court has cancelled all 122 licences issued by the ministry he headed if the prosecution fails to prove beyond doubt that it was Raja who committed actions amounting to a conviction under various criminal offences he is being tried for. What has muddied this distance between the respective scopes of the two proceedings, however, is the Supreme Court’s affirmation of certain actions allegedly committed by Raja, some of which are being examined by the Special CBI court in the ongoing trial.

One of the five questions put before the Supreme Court by the petitioners – Question (iv) – was whether the first-come-first-served principle was arbitrarily changed by Raja with a view to favour some of the applicants. A juxtaposition of this question with Section 13(d)(i) and (ii) of POCA under which Raja is being tried in the Special CBI court reveals the overlap in the scope of examination. The substance of Section 13(d)(i) and (ii) is whether (i) by corrupt or illegal means, or by abuse of position as minister, (ii) Raja obtained for himself or for any other person (applicants), (iii) valuable thing or pecuniary advantage (license and spectrum).

Was this question on individual actions of Raja absolutely vital to effectuate cancellation of 122 licences and impose a penalty on some licensees who benefited due to the DoT’s exercise? The answer is, no. Even if this question was included, and a petitioner before a court has every right to do so, could the SC have refrained from answering this question and, yet, arrive at its conclusion of cancelling 122 licences? The answer is, yes.

If the Supreme Court refrained from passing any order on Subramanian Swamy’s plea to ask the CBI investigate Chidambaram lest it may prejudice Special CBI court’s decision on sanctioning prosecution against Chidambaram, it could have refrained from answering this Question (iv) as well on the same grounds. Moreover, government departments are widely known to take arbitrary decisions without a sound rationale or a fair procedure against which constitutional remedies are often granted to affected parties. The two decisions — arbitrarily shifting the cut-off date and granting spectrum to ineligible applicants — were sufficient to conclude the inherent arbitrariness and unfairness in allocation of spectrum licences under Article 14 of the Constitution of India to justify cancellation and imposition of penalties.

Since the Supreme Court had to opine on the illegality of the two decisions, a question may well arise on whether these two decisions can be sufficient to conclude applicability of Section 13(d)(i) and (ii) given that these actions also resulted in a pecuniary benefit to the licensees. The answer is in the negative since an additional requirement under Section 13(d) is to establish corrupt or illegal means or abuse of position by the decision maker.

As it turns out, this is precisely what the Court ended up doing. In answering Question (iv) in Paragraph 77 of the Order, the Court basically affirmed that (i) all of Raja’s actions were “stage-managed” in order to deliberately favour some licensees; (ii) those who had access to Raja could extract benefits from the process; and (iii) DoT officers followed his orders lest they may incur his wrath. In affirming these allegations as established facts to answer Question (iv), the Supreme Court has, perhaps unwittingly, established abuse by Raja of his position as a minister. In addition to focusing on the executive decision, the Supreme Court also focused on the primary executor of the decisions, a job better left to a trial court where the executor has opportunities for cross-examination.

Indeed, if the Supreme Court was confident that such allegations were now established facts despite pendency of the trial in the Special CBI court, it should have asked Raja to present his defence. Justice Ganguly has explained that on Devil’s Advocate stating that Raja’s actions as a minister were defended by the law officers of the Government of India.

However, there is a vital difference here in the two capacities Raja held during the entire duration of this matter. Until November 2010, Raja was the Minister of Telecom, and, thereafter, a private individual facing criminal trial. Till the time he continued to be a minister in the UPA government, the Attorney General was obligated to, and, indeed, did, defend Raja’s actions known at that point of time. For example, the Attorney General continued to defend the DoT’s decision to advance the cut-off date as neither arbitrary nor unconstitutional. Once Raja was no longer a part of the government, and allegations of abuse of power came to light, the law officers could not have possibly defended Raja when the same government was simultaneously prosecuting him for those very actions.

Lastly, can it be argued that since this matter lasted for several months, Raja should have defended himself instead of waiting for the Supreme Court to pass this order? Though this argument is compelling, plausible answers to it are that: (i) it could not be incumbent upon him to be aware of the contents of the petition since he was not made a Respondent in that matter, and (ii) he could not have assumed that the Supreme Court would have affirmed such allegations as facts in an Order concerned with cancellation of licenses without waiting for the Special CBI court to establish them as facts. How Justice Singhvi and his brother Judge deals with the review petition remains to be seen. Notwithstanding the fact that the media and the nation have pronounced Raja as guilty, in a democracy governed by the rule of law, it is a court of law which has the final say. Raja’s review petition has strong grounds which can possibly put a hold on the ongoing trial till the Supreme Court rules on the review petition.

To criticise government policy through judicial activism is one thing, often welcomed when the government is found asleep. To affirm allegations yet to be established as incontrovertible facts in a trial court is quite another. The Supreme Court has given Raja something to cheer about, albeit only temporarily.

kartikeya@tannaassociates.com