New Delhi: Expanding its probe to cover the NDA regime, CBI on Saturday registered a case against Shyamal Ghosh, who was Secretary in the Telecom Ministry headed by late Pramod Mahajan, and two Telecom service providers – Airtel and Vodafone for alleged irregularities in grant of additional 2G spectrum.
Immediately after registering of the case, CBI teams searched the offices of the two major telecom companies and residences of Ghosh and J R Gupta, who was the Deputy Director General (Value Added Services) in the Telecom Ministry during Mahajan's tenure.
The searches were carried out at the official premises of Vodafone in Mumbai, Airtel in Gurgaon and residences of Ghosh and Gupta, CBI said.
The fresh case in which the CBI alleged there was a loss of Rs 508 crore to the state exchequer during 2001-07 came in the wake of directions from Supreme Court to probe allocation of spectrum between 2001 and 2007 after the CBI filed cases against former Telecom Ministers Dayanidhi Maran and A Raja.
The case against Ghosh, Gupta, Bharti Cellular (now known as Bharti Airtel), and Hutchinson Max and Sterling Cellular (now known as Vodafone Essar) was registered  under 120-B (criminal conspiracy) and various sections of Prevention of Corruption Act, CBI alleged. Gupta retired as Director, Bharat Sanchar Nigam Limited.
"The then Minister for Telecom and Communication (Pramod Mahajan) has been excluded since he expired," CBI said in a statement but accused he was a part of criminal conspiracy to allocate the additional spectrum in a "hurried" manner. Mahajan of the BJP was the Telecom Minister during 2001-03.
Responding to the raids, both Bharti Airtel and Vodafone said they had always maintained the highest standard of corporate governance and regulatory compliance.
CBI had registered a Preliminary Enquiry to look into the allocation of spectrum under Mahajan to certain companies beyond the prescribed limit.
The CBI alleged in its FIR that Department of Telecom had increased the base spectrum for telecom companies from 4.4 MhZ to 6.2 MhZ during Mahajan's tenure from 2001 to 2003 and also allocated extra spectrum on subscriber-based criteria.
In the FIR, CBI said a case has been registered against the then Telecom Secretary, the then DDG (VAS); three Private Cellular Companies, and others for alleged irregularities in the grant of additional 2G Spectrum and causing a Loss of Rs 508 crore approximately during the period 2001-2007.
It was alleged that the then Secretary (Telecom) and the then DDG (VAS), Department of Telecom, entered into a criminal conspiracy with three beneficiary private companies, based at Delhi and Mumbai, and abused their official positions as public servants.
"We would like to categorically state that all the spectrum alloted to us from time to time has been strictly as per the stated government policy," Bharti Airtel spokesperson said.
"We are providing all details and correspondence to the authorities and shall provide complete support as needed in the matter," the spokesperson said.
Vodafone said all their documents related to the spectrum allocation were in compliance with the governing laws and regulations and it was cooperating with the agency officials.
"There was a visit by CBI officials this morning at our office in Mumbai and Delhi seeking information related to the spectrum allocation to operators during 2001-02. All our documents are in complete compliance with the governing laws and regulations," a company spokesperson said in a statement.
"Vodafone India is completely co-operating with the officials and will provide them all the required details as part of their checks," the spokesperson said.
"The public servants, with approval of the then Minister of Telecom (Communications and IT) (since expired), took an alleged hurried decision on 31.01.2002 to allocate additional spectrum beyond 6.2 MHz in violation of the report of a Technical Committee etc.
"The accused persons also decided to allocate such additional spectrum beyond 6.2 MHz by charging spectrum fee of an incremental one percent AGR (Adjusted Gross Revenue) only for allotting additional spectrum from 6.2 MHz upto 10 MHz instead of charging incremental one percent AGR on allotment of spectrum beyond 6.2 MHz and charging incremental two percent AGR on allotment of spectrum beyond 8 MHz, as applicable in normal prudence," the CBI FIR alleged.
The CBI alleged that the accused persons showed "undue favour and caused undue cumulative advantage of approximately Rs 508.22 crores to beneficiary companies, including the three accused companies, since allocation of such additional spectrum till such decision was reversed by DOT in 2008, and corresponding loss to the exchequer."
CBI spokesperson said during monitoring of the 2G Spectrum Scam Case, Supreme Court directed CBI on December 16, 2010 to investigate the irregularities committed in the grant of licenses from 2001 to 2007 with particular emphasis on the loss caused to the public exchequer and corresponding gain to the licensees or service providers.

Swamy welcomes CBI probe

Janata Party president Subramanian Swamy on Saturday welcomed the CBI move to include the Pramod Mahajan tenure in the mobile spectrum allocation case and stressed that "one should not play politics" in corruption cases.
"I think the CBI, now that the main case is also underway, has started devoting attention to the Mahajan period too and it needs to be done," Swamy told reporters on the sidelines of an event here.
"I don't think in the corruption matter you should play politics at all," Swamy, a bitter critic of Congress, said about the CBI's move to probe the spectrum allotments done during the NDA regime.
The widening of the probe is being done as per the instructions of the Supreme Court, which had asked the CBI to investigate all the earlier instances of spectrum allocation right from 1999, he said.
The searches carried out on Saturday on leading telecom operators and a former bureaucrat in the telecom ministry is a part of the move to widen the scope of the investigations, he said.
Swamy, a petitioner on the 2G spectrum allocation case which has led to the arrest of former telecom minister A Raja, DMK MP Kanimozhi and quite a few corporate honchos, said he will devote time for unearthing corporate corruption once the 2G case finishes.
The Government will fall because of the series of corruption scandals and we will have to face a mid-term poll by March, he said.
"Yes, definitely. By March next year, yes. I am expecting in this Parliament session for something to happen," he said, when asked to elaborate on similar remarks he made during a TV programme.
When asked if there will be a no-confidence move, he said, "Either that or some scandal forces the government to resign."
In an interesting disclosure, the former professor said he has taught former Goldman Sachs key executive Rajat Gupta, now facing allegations of insider trading in the US, in the Indian Institute of Technology and had also recommended the pupil for an MBA degree.
"I recommended him (Gupta) for an admission to MBA. Thats how he went. He went to do engineering and then did his MBA. He was a very good man but became greedy," he added.