No violation on Swan Telecom holding, license: RCOM

MUMBAI - Reliance Communications categorically reiterated Sunday it had violated no norms, as its own and the group’s equity holding in Swan Telecom, now under probe in the 2G spectrum saga, did not exceed 9.9 percent.

The company, which offers mobile telecom under the platforms of both CDMA and GSM, said it got a dual technology license under the same terms that applied to three other firms - Tata Teleservices, Himachal Futuristic and Shyam Telecom.

“There is nothing special or untoward in the same,” Syed Safawi, president for wireless with Reliance Communications, said during a conference call with journalists and analysts Sunday, seeking to clarify the group’s position.

He said the company’s holding in Swan Telecom was also duly disclosed to all the concerned agencies and departments, including the Comptroller and Auditor General of India and the Department of Telecom.

“Reliance Communications has not violated any of its license conditions at any stage on account of cross-holding of 10 percent or above in another licensee and is in full compliance with all applicable guidelines, rules and regulations.”

The comments come against the backdrop of the arrest of Shahid Balwa, managing director of DB Realty, which promoted Swan Telecom, which was allegedly favoured in the grant of spectrum and telecom licences in 2008.

On dual technology, Safawi said, the grant was based on the recommendation of the Telecom Regulatory Authority of India after due public consultation, which was also approved by the government.

“The grant of dual technology approval to RCOM in October 2007 has also been upheld by the honourable Delhi High Court by a judgment in August 2008 and the tribunal by an order in March 2009,” he said.

“The unfortunate, erroneous reporting on these matters, in relation to alleged admissions, discrepancies, probing of links, funding and other sensationalist terminologies is unfair and mischievous, apart from being completely misplaced and unwarranted.”

The company also said the probe by the Central Bureau of Investigation (CBI) on the second generation (2G) spectrum issue on the orders of the Supreme Court covered a large number of telecom companies and their officials across the country.

“Contrary to media positioning, investigations by the CBI and other authorities are by no means specific to RCOM executives, and instead, have reportedly covered more than 50 people from across a large number of telecom operators,” he said.

“As duty-bound in law and in good faith, we are fully cooperating with the authorities in this regard, and will continue to extend all assistance as required to enable them to complete their investigations.”

Safawi also alleged that the old 2G telecom operators had caused the exchequer losses worth a staggering Rs.1,00,000 crore by fraudulent misrepresentation and concealment of material facts from the government.

“The loss of revenue to the government by the old 2G operators, on account of hijacking of excess spectrum alone, has been computed at figures of as high as a shocking over Rs.55,000 crore,” he said.

“Several of the old 2G operators also secured prized and most valuable original eight licenses in Mumbai, Delhi, Calcutta and Chennai in 1994-95, on a nominated basis without any auction and by nearly zero payment of license fees,” he said.

“In the interests of a level playing field, fairness, equity and transparency, RCOM looks forward to the completion of investigations by the CBI, covering all these aspects of the 2G telecom regime in India,” he said.

The company, he added, also looked forward to the probe agency identifying the real beneficiaries, who by fraudulently misleading the government and connivance with certain officials, caused these staggering losses and amassed huge wealth.