Apex court reserves verdict on monitoring spectrum probe (Second Lead)

NEW DELHI - The Supreme Court Wednesday reserved its verdict on a petition seeking its monitoring of the Central Bureau of Investigation (CBI) probe into the 2G spectrum controversy.

The petition was moved by the Centre for Public Interest Litigation (CPIL).

The court also expanded the scope of CBI investigation into the 2G spectrum controversy by directing it to probe the issue of banks advancing loans to telecom operators on the hypothecation of spectrum licences.

“If it is true then it is astonishing,” said an apex court bench of Justice G.S. Singhvi and Justice A.K. Ganguly when it was told that for a Rs.1,600 crore pan-India licence of 2G spectrum, a public sector bank gave a loan of Rs.2,500 crore.

While observing that the 2G licences were far more valuable than the price at which they were given, the court said if it was true, then it went far beyond what the petitioner was claiming.

The court was informed that the investigating agency was probing the sources of funds which different telecom companies mobilized for applying for 2G spectrum licences.

The court was also told that the grant of loan on the hypothecation of 2G licence would be referred to the CBI’s banking securities fraud cell.

The judges said that there has to be a close co-ordination between the CBI and the Enforcement Directorate (ED) to unearth the entire scandal.

They said this after going through the ED report on its investigations into money laundering related to the spectrum allocation.

During the hearing, the court described as absurd the policy of granting 2G spectrum licences in 2008 at 2001 prices.

“This is an absurd policy,” the court said. It also said that to get to the root of the entire scam, the investigation should commence from 2001 when the existing telecom policy was put in place.

“Why dont you give us petrol at 2001 prices, the court asked, criticising the policy.

The court said that in a period of spiraling prices, the government was engaged in a commercial transaction and was not involved in charity.

Slamming the Department of Telecommunications, the court said that even if it was a policy to give licences at 2001 prices, the 2G spectrum could not have gone for a song. Even a policy has to have a meaning, it said.

The bench also noted that the existing courts which were already overburdened with work could not be further burdened to deal with cases of huge financial magnitude, including the 2G spectrum controversy, involving allegations of money laundering.

It also said there was need for special courts to deal with special laws like the one to prevent money laundering. The court asked Solicitor General Gopal Subramanium to take instructions from the government on this count.

Anybody who has violated the law and the economic interests of the country has to be brought to book, the court said.