Alleging that the exchequer has lost a staggering Rs 190,000 crore (Rs 1.9 trillion from the 2G spectrum, Communist Party of India (Marxist) demanded dropping telecom minister A Raja at least during the period of the probe.
Quoting the observations made by the post and telecommunications audit office in a memo to the department of telecom, senior CPI (M) leader Sitaram Yechury said the issue of 2G spectrum licence to private telcos "lacked" fairness and transparency.
"There are coalition compulsions. There are compulsions of commitment to principles and values and law of the land. Prime Minister Manmohan Singh has always placed a premium on value-based politics. If he wants to value his own premium, I am sure he should act (by dropping Raja)," the CPI (M) leader told newsmen in New Delhi.
Yechury was responding to a question whether coalition compulsions will allow the prime minister to take action against Raja, who, according to the CPM, is instrumental in undervaluing the 2G spectrum and causing huge loss to the government.
"If we use the recent 3G auction price to benchmark the spectrum price for 2G as Trai has recently suggested, the loss is of the order of a whopping Rs 190,000 crore," Yechury said, adding Raja's argument that 2G was priced at a low Rs 1,650 crore (Rs 16.5 billion) per operator with a view to keep the prices of services to the consumer low "does not hold water".
"Those who bought the airwaves sold it for five or six times more. Did it result in rise in telephone rates?" he asked.
Asked about Tamil Nadu chief minister M Karunanidhi's claim that Raja is being targeted because he is a Dalit, Yechury said they are not targeting Raja but the telecom minister.
Yechury also distributed copies of the memo issued to the DoT by senior audit officer (inspector) Rajendra Kumar on March 31 during the audit of the issue of licences of 2G and 3G spectrum.
The memo cites several instances like violation of Trai recommendations by changing the cut-of-date and some of the applicants preparing bank drafts for entry fee earlier. It also noted that there is a gap of about two hours in Swan, one of the allottees, submitting the letter of intent for the Delhi and Mumbai circles and other areas, which the auditor
said is needed to be "justified".
"In view of the above, prima facie it infers that the whole process of issuing the 2G licence lacked fairness and transparency," the memo said. The memo has been sent to the ministry for comments.
According to the document, the decision to process the applications were received up to September 25, 2007 was taken on November 2, 2007 but was conveyed to the applicants at the "eleventh hour", which is "1:47 pm on 10 January, 2008, the date of issue of LoI".
The post and telecommunications audit office memo said the decision to change the cut-off date of the application retrospectively was violation of the Trai recommendations. It was also "unfair to the applicants who had applied between September 26, 2007 and October 1, 2007 as they were deprived of their right to be part of the initial process".
The auditor also raised question about not releasing a press statement issued on January 10, 2008 on the Press Information Bureau website.
The memo noted that the decision to process the applications received till September 25, 2007 was conveyed to the applicants through a press release on January 10 next year and all the LoIs were prepared after which another statement was issued asking them to assemble at the Shastri Bhavan on the same day at 3:30 pm.
"Justifications or reasons on the basis aforesaid decision taken by the department were not found available in the record. Urgency and justification behind the aforesaid decision may be elucidated to audit," the memo said.
The auditor observed that the release was uploaded at 2:45 pm and it did not seem to be practically possible for applicants who were scattered across the country to reach the venue within an hour.
The memo further said 15 days were given by the DoT to comply all terms and conditions of LoIs but it was noticed that bank drafts were already prepared by some of the applicants.
On Swan Teleco, the auditor noted that it submitted the compliance for LoI for Delhi and Mumbai service areas along with the payment of the entry fee, performance bank guarantee, financial bank guarantee and other documents at 4:11 pm on January 10, 2008.
"Compliance for other service area was made by Swan at 6:25 pm on the same day. This has resulted Swan had got first spot in Delhi and Mumbai. The difference of two hours in compliance for different service by a single applicant needs to be justified," it said.
"PBGs and FBGs submitted at Delhi on the same day were also issued by the Punjab National Bank in Mumbai on the same day," it noted.
