New Delhi: The corporate world in 2011 found itself on tenterhooks as various scams in the telecom and the mining sector came under the prying eyes of the Supreme Court. (Agencies)
Business tycoons like Ambanis, Tatas and Ruias had to face legal battles that kept share prices of their companies fluctuating in bourses and the constant monitoring of the probe into the 2G scam resulted in the arrest of political heavyweights and high-profile corporate honchos.
The telecom scam and the issues concerning the sector also brought anxious moments for Home Minister P Chidambaram and Telecom Minister Kapil Sibal who had to put to use all legal resources available with them to counter various allegations against them.
Sibal wriggled himself out of the allegation of reducing a penalty amount favouring Anil Ambani-headed RCOM but the Apex Court reserved its order on the plea for a probe into the alleged role of Chidambaram in the 2G scam after the CBI and government made a spirited defence of him in the court.
However, when Janata Party Chief Subramanian Swamy was launching a legal salvo against the telecom companies and the home minister in the 2G case, the finance ministry note to Prime Minister Office signed by Finance Minister Pranab Mukherjee brought further embarrassment to Chidambaram.
The note stated that Raja alone could not be blamed for the loss to the exchequer in 2G allocation as Chidambaram, who was the Finance Minister in 2008, could have suggested sale of radio waves through auction.
Due to the strict monitoring of the cases, Reddy brothers of Karnataka, ex-telecom minister A Raja, his DMK colleague Kanimozhi, corporate bigwigs from Reliance ADAG, Swan Telecom and Unitech Ltd hogged the attention with the legal battle concerning the business world in the Apex Court.
The parallel inquiry set up by Sibal to examine the actual loss to the exchequer in the 2G scam did not help any as the Apex Court gave free hand to the CBI and Enforcement Directorate to go ahead with their probe uninfluenced by "high and mighty" which eventually resulted in the arrest of 14 influential people.
While Raja was the first to be arrested along with his private secretary R K Chandolia and former telecom Secretary Sidharth Behura, the days ahead witnessed the same fate for Rajya Sabha MP Kanimozhi and top corporate honchos – Sanjay Chandra of Unitech Ltd, Shahid Usman Balwa and Vinod Goenka, both promoters of Swan Telecom and D B Realty.
Three top corporate managers of Reliance Anil Dhirubhai Ambani Group (RADAG) -- Gautam Doshi, Surendra Pipara and Hari Nair -- also spent around seven months in jail along with DMK-run Kalaignar TV director Sharad Kumar, film producer Karim Morani and two other businessmen -- Asif Balwa and Rajeev Aggarwal of Kusegaon Fruits and Vegetables Pvt Ltd.
While the arrest of the high-profile accused was the high-water mark in the case, more trouble was in store for the corporate houses like RADAG's Reliance Telecom, Balwa's Swan Telecom and Unitech Wireless (Tamil Nadu) Pvt Ltd which were also made accused in the case.
However, when the heat was on, the Supreme Court brought a moment of hope for the corporate world when it granted bail to the disgraced founder Chairman of Satyam Computer B Ramalinga Raju and his colleagues in the case of accounting fraud after they spent two years and eight months in jail.
A fortnight later on November 23, relief came to the accused in the 2G case when five corporate honchos were granted bail by the Apex Court which relied on the old dictum that "bail is the rule and jail an exception" and public sentiments have no bearing on the liberty of a person.
The Apex Court ruling came as a succour to others as the trial court and the Delhi High Court took a cue from it and provided bail to others in the 2G case leaving only Raja and Behura in jail.
Besides the telecom scam, the illegal mining issue, especially in Karnataka, engaged the apex court which passed a slew of directions, including a CBI probe, which resulted in arrest of mining baron from Bellary district G Janardhan Reddy, who was a minister in the then Yeddyurappa government.
The Apex Court ordered complete ban of iron ore mining in the districts of Bellary, Tumkur and Chitradurga by the private sectors and directed the CBI to probe other major companies M/s Adani Enterprises and M/s Jindal Steel (JSW), Associated Mining Co and Deccan Mining Syndicate that have been strongly indicted in the Lokayukta report.
Sahara Group, which got a temporary breather in the Apex Court against the order of the Securities Appellate Tribunal directing its two companies to refund around Rs 17,400 crore to their investors, however, found itself in a ticklish situation when the top court found prima facie material to initiate contempt proceeding against its chief Subrato Roy Sahara for interfering with the probe in 2G case.
However, Tatas, whose name was dragged more than once in the 2G scam, had a sense of relief when on September 29, the CBI filed a status report in the apex court and virtually gave a clean chit to it and the Videocon group in the case.
Essar Group and Loop Telecom, also under the lens of the Apex Court throughout the probe were not as lucky as Tatas as the CBI issued them charge sheets for the offences of cheating and conspiracy to secure the 2G licence by misrepresentation.
While Tatas got a relief in the 2G case, the petition filed by its chief Ratan Tata, seeking probe and ban on publication of the taped conversation of corporate lobbyist Niira Radia with politicians, businessmen and journalists, is still pending.
However, one corporate matter whose outcome was eagerly awaited was the high profile Rs 11,000 crore tax dispute between telecom major Vodafone and the I-T Department, the verdict of which has been reserved after a marathon hearing.
New Delhi: The corporate world in 2011 found itself on tenterhooks as various scams in the telecom and the mining sector came under the prying eyes of the Supreme Court.