New Delhi, Dec 21 (PTI) Essar Group promoters Ravi KantRuia and Anshuman Ruia were today acquitted in a case arisingout of the 2G scam probe by a special court which said therewas no evidence to suggest that they controlled Loop TelecomLtd, an alleged beneficiary of the spectrum allocation.
Special judge O P Saini, who acquitted all 17 accusedincluding ex-telecom minister A Raja in the main CBI caseholding that there was no scam, also let off Loop Telecompromoters I P Khaitan and Kiran Khaitan saying there was nomaterial on record to indicate that bogus transaction wascarried out for securing 2G licences.
"The weight of the evidence, both oral and documentary,is that I P Khaitan was the man behind the entire eventsalleged in the instant case. Evidence is on record to theeffect that I P Khaitan owns his own group of companies knownas 'Khaitan group' and it is separate and independent fromEssar group. When two groups are independent, there can be noviolation of Clause 8.
"The witnesses examined by the prosecution itself deposedthat BPL companies were acquired by I P Khaitan and it was I PKhaitan on whose instructions the applications for 21 UASlicences were filed. In these circumstances, there is nomaterial on record to indicate that it was a sham or bogustransaction. Evidence referred to above is almost crystalclear and the same is against the prosecution," the courtsaid.
Immediately after the verdict, Essar Group in astatement, said, "We are thankful to the court for thejudgement as it vindicates our stated position and the courthas appreciated/vindicated it."The Ruias, the Khaitans; Essar Group Director (Strategyand Planning) Vikash Saraf, had faced trial in the case, alongwith three telecom firms — Loop Telecom, Loop Mobile India andEssar Tele Holding.
CBI had listed the accused in its charge sheet onDecember 12, 2011, alleging that they had cheated theDepartment of Telecommunication (DoT) by using Loop Telecom asa "front" to secure 2G licences in 2008 in violation of Clause8 of the Unified Access Service License (UASL) Guidelines.
According to the Clause 8 of the UASL guidelines "Nosingle company/legal person, either directly or throughassociates, shall have substantial equity holding in more thanone licensee company in the same service area for AccessServices namely; Basic, Cellular and Unified Access Service".
The court was critical of the conduct of the DoT and saidif it felt that spirit of clause 8 was being violated by meansof "excessive debt funding" by one licensee company to anotherthen it was free to amend its guidelines.
"There is no material on record that DoT took any stepsto do any of these things. Instead of course correction bytaking appropriate administrative action, the DoT startedplaying victim claiming that it has been cheated by LoopTelecom Limited as it was indebted heavily to a group, whichalready had more than 10 per cent equity in an existing panIndia licensee, i.e, Vodafone Essar Limited," the court said.
It said the prosecution has failed to prove that LoopTelecom Ltd was a company of Essar group or was substantiallycontrolled by it and therefore was not eligible for applyingof UAS licences.
Rejecting CBI's contention that DoT was cheated intoissuing 21 UAS licences, the court said that when theprosecution has failed to prove that Loop Telecom Ltd was acompany of Essar group then there can be no falserepresentation and no ingredients of Section 420 IPC are madeout.
"In the instant case, there is no material on record toshow that the applications for 21 UAS licences were filed atthe instance of Vikash Saraf. There is also no evidence thatin the filing of applications Ravi Kant Ruia, Anshuman Ruia orKiran Khaitan were involved.
"The evidence is to the effect that the applications werefiled at the instance of I P Khaitan, which version matcheswith the record. Thus, there is no evidence indicating anydeception of DoT by any of the accused," it said.
The court also refused to agree with the submission thatEssar group, which had 33 per cent equity in Vodafone EssarLimited, a pan India licensee, acquired licences in 21 serviceareas by using Loop Telecom Limited under the guise that itwas owned by I P Khaitan and his wife.
"The witnesses have deposed that all the transactionswere genuine one. Thus, there is no evidence on record thatthe transactions were not genuine or were sham or circuitousaimed at controlling of Loop Telecom Limited by Essar group.
"Accordingly, there is no question of lifting anycorporate veil. It may be noted that corporate veil is a legaldevice and is not illegal by itself. It is acquired by acompany on its incorporation. It can only be lifted when fraudis committed by taking advantage of the corporate veil. Thus,there is no merit in the submission of the prosecution thatcorporate veil is required to be lifted," the court said.
The court said that the alleged motive that Essar groupacquired BPL companies (now known as Loop) in the name ofKhaitan in order to run telecom business after exitingVodafone Essar Limited could not be proved as none of thewitnesses deposed a word about it. PTI PKS AG UK ABA RRT SKVSJK RKSZMN.
This is unedited, unformatted feed from the Press Trust of India wire.