Supreme Court questioned the government's failure to cancel spectrum allocations/Govt could not have cancelled spectrum allocation: CBI-Oct 15, 2011

Govt could not have cancelled spectrum allocation: CBI

Dhananjay MahapatraDhananjay Mahapatra, TNN | Oct 15, 2011, 03.27AM IST


NEW DELHI: A day after the Supreme Court questioned the government's failure to cancel spectrum allocations despite being aware of alleged irregularities, the CBI on Friday said issuance of letters of intent and acceptance of licence fee made scrapping of the agreements legally untenable.

In a short note submitted to a bench headed by Justice GS Singhvi, the CBI said the LoIs provided that licences would follow once entry fee, performance guarantee and unequivocal undertakings were given. Shyam Telecom and Swan fulfilled these conditions on January 11, 2008 while all others did it a day earlier.

Petitioner Centre for Public Interest Litigation had also submitted that no legal rights were created in favour of the telecom companies on January 10, 2008, the day when the LoIs were granted.

The CBI said: "The statement that no rights were created for the allottees on January 10, 2008 is legally unsound. It may not be correct to state that after receiving the amount of Rs 1,600 crore for each licence, and fulfilling of other conditions in the LoIs, the licences would still be open to cancellation."

A bench of Justices Singhvi and HL Dattu had on Thursday asked the government why it failed to take steps to cancel spectrum allocation, which took place much after January 10, 2008, even after the head of the government was aware of the alleged irregularities in the grant of licences.

To lend force to its stand that cancellation of spectrum allocation was legally untenable after grant of LoIs and acceptance of licence fee, the CBI cited a January 4, 2011, judgment of the Supreme Court, in which Justices Singhvi and C K Prasad had taken the view that a letter of intent could create rights in favour of the LoI holder.

Senior advocate Ram Jethmalani, appearing for accused Sanjay Chandra, requested for an urgent hearing on his client's plea for interim bail. The court fixed October 31 for hearing on this plea.