Catch the big fish, apex court tells CBI in 2G scam case

NEW DELHI - The Supreme Court Thursday asked the Central Bureau of Investigation (CBI) to go after the big fish involved in the 2G spectrum scam and the beneficiaries of the wrongdoings. It also told courts not to pass any orders related to the federal agency’s probe.

The court said that the CBI investigation should not be confined to four people (former communications minister A. Raja, his two aides and a telecom company’s official) or their ilk but should go for the big fish who were the main conspirators and real beneficiaries.

The court said: “We have a large number of persons who think that they are law onto themselves.”

No court shall pass any order which may in any way impede the CBI investigation into the 2G scam, the apex court bench of Justice G.S. Singhvi and Justice A.K. Ganguly said.

Sharpening the focus of the CBI investigation, the court said: This investigation (by CBI) has led to prima facie finding about the culpability of X, Y, Z but what about the beneficiaries who were the part of larger conspiracy.

The observations by the court came in the wake of the consideration of the first status report filed by the CBI after it (court) took upon itsself the monitoring of the investigation into the scam involving the grant of second generation (2G) airwave allocation to telecom companies.

The report has identified Raja as one of the main conspirators who, in collusion with other officials, conspired to arbitrarily change the cut-off date and took decisions on the policy of first-come-first-serve (FCFS) and the allocation of dual use technology.

The report said that some companies were granted spectrum ignoring the seniority of others and the policy of FCFS.

The report submitted in two volumes said that banks deviated from their internal guidelines and rules in the grant of loans to the companies bidding for 2G spectrum licence.

When the court asked if the accounts of these companies could be frozen, senior counsel K.K. Venugopal said that after the competent authority sanctioned and backed collateral security these loans cant be described as illegal.

The court was also told that in some cases the loans were advanced even before the grant of licence.

The report also trails the sources of money, the currencies they were paid in and the countries where it was transacted. The court was told that Shahid Balwa, managing director of DB Realty, who was not cooperating with the investigating agency has been arrested.

In an apparent reference to Kalaignar TV, Venugopal told the court the money trail leads to a television channel owned by the leader of a political party.

At the outset of the hearing, the court said: We dont want to interfere with the course of action.

The court wondered whether the freedom of the CBI was being curtailed by the short remands (referring to two to three days remand of Raja). The CBI must have a free hand to question and investigate the people.

Venugopal said that Thursday, the CBI will seek longer remand of Raja and his associates.

The court directed the investigating agency to probe into the acts of wrongdoing in the grant of 2G licences and the grant of dual use technology prior to Oct 19, 2007 — much before the licences were officially allocated in 2008.

The investigating agency is also looking into the failure of the department of telecommunications to proceed against the telecom giants for their failure in carrying out their roll out obligation.

The court also directed investigation by the Income Tax department and the Enforcement Directorate in the case from 2001-06.

The matter will come up for hearing March 1, when Vahanvati will inform the court about the government’s response to the suggestion to set up a special court to try the 2G scam case.