1 Index S. No. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. Name Mr. Manmohan Singh Mr. P Chidambaram Mr. Pranab Mukherjee Mr. Sharad Pawar Mr. S M Krishna Mr. Kamal Nath Mr. Praful Patel Mr.

Vilasrao Deshmukh Mr. Virbhadra Singh Mr. Kapil Sibal Mr. Salman Khurshid Mr. G K Vasan Mr. Farooq Abdullah Mr. M K Alagiri Mr. S K Shinde Page No. 2-4 5-29 30-33 34-37 38-40 41-43 44-48 49-52 53-54 55-58 59-63 64-65 66 67 68-79

2 Dr. Manmohan Singh Dr. Manmohan Singh is the Prime Minister since May 2004 and was personally in-charge of the Coal Ministry from November 2006 to May 2009. Under his watch a major coal allocation scam took place which allowed private firms to make windfall gains, as is clear from the facts that are now out in the public domain and the report of the CAG. The average allotment of coal blocks was 3-4 per year until a few years back. But this number shot up drastically to 22-24 during 2006-09 when Dr. Singh was in charge, raising questions about the manner in which these allotments were made. All the allotments were made without transparency, without protecting the interest of public exchequer, and without any competitive process. A comprehensive note on competitive bidding for the allocation of coal blocks was given by the Coal Secretary to the Minister of State for Coal on 16 July 2004. It noted the substantial difference between the price of coal supplied by Coal India Limited (CIL) and the cost of coal produced through captive mining. This ensured a "windfall gain" to the party which was allocated a captive block. That same month, the Minister of State sought clarification on what he feared would be "likely opposition from the power sector". The Coal Secretary was explicit that the existing system of allocation, even with modifications, would not be able to achieve the objectives of revenue maximisation, transparency and objectivity in the allocation process. However, rather than accept this advice, in September 2004, the PMO forwarded a note detailing what it claimed were certain disadvantages of the proposed system. Subsequently, the Coal Secretary remarked that "there was hardly any merit in the objections raised" by the PMO. The secretary also highlighted some of the "pulls and pressures" experienced by the screening committee during the decision making process and stressed that all pending applications were recommended on the basis of competitive bidding, and that allocations should be made on such a basis. This recommendation was ignored by the PMO. The CAG draft report remarked that steps could have been taken to allocate coal blocks through competitive bidding well in September 2004 itself. In October 2004, the MoS again argued that the proposal for competitive bidding may not be pursued as the Coal Mines (Nationalisation)

3 Amendment Bill 2000 was pending in the Rajya Sabha with stiff opposition from trade unions. He also disagreed with the opinion that the screening committee could not ensure transparent decision making. He said that this was "not an adequate ground for switching over (to) a new mechanism". The matter was once again put before the PMO, after which, 28 June 2004 was decided as the cut-off date for considering applications as per the current policy rather than the proposed policy. In March 2005, the Coal Secretary again put up a note to the PM stating that if the revised system was not put in place quickly enough, pressure would again mount on the government for continuing with the existing procedure. Subsequently, the PMO in August 2005 asked the coal ministry to amend the Coal Mines (Nationalisation) Act 1973 before the new system became operational. "Since this was likely to take considerable time it was decided that the coal ministry would continue to allot coal blocks for captive mining through extant screening committee procedure till the new competitive bidding procedure became operational," the note states. Again in November 2005, the MoS said that the PMO had taken a view to amend the Coal Mines (Nationalisation) Act, which was a "time consuming exercise and as such allowed the department to proceed with the existing system" ... "there was no immediacy..." In April 2006, it was decided to amend the MMDR Act so that the system of competitive bidding could be made applicable to all minerals. Later on, delaying the matter further, the MoS opined that the issue of amendment should be "revisited" as it had the potential to become controversial. Finally, the bill to amend the MMDR Act was introduced in Parliament in October 2008 and passed in August 2010. While the amendment to ensure coal allocation by auction remained in abeyance because of the Dr. Singh’s interventions as head of the Cabinet and in-charge of the coal ministry, 24 blocks were allocated in 2005, 53 in 2006, 52 in 2007, 24 in 2008 and 16 in 2009. Interestingly, postamendments, only one coal block was allocated in 2010, and not even one in 2011. Obviously there was a rush for coal blocks allocated under the old, noncompetitive, system. As on June 2004, only 39 coal blocks stood allocated. "But since July 2004, 155 coal blocks were allocated to government and private parties following the existing process. The CAG in its draft report has pegged the losses running in lakhs of crores. A copy of the relevant chapter of the report is annexed as Annexure A. It is understood the final

4 report is similar to the draft report. The final report though has been submitted to the Government, the Government chose not table it in the Budget session of Parliament. The above facts clearly show that the Dr. Singh abused his position to give huge pecuniary benefits to private parties, which is an offence under Section 13 of the Prevention of Corruption Act. Therefore the said matter needs a thorough independent investigation.

5 Mr. P Chidambaram Mr. P Chidambaram was the Finance Minister from May 2004 to November 2008 and has been Home Minister since December 2008. This note against him is divided into 5 heads: 1. Pricing of 2G Spectrum 2. Allowing sale of equity by Swan and Unitech 3. FIPB approval of Hutch-Vodafone 4. FIPB approval of Aircel-Maxis 5. Unwarranted attempts to withdraw prosecution 1. PRICING OF 2G SPECTRUM Mr. Chidambaram as Finance Minister overruled the officers of his own Ministry who favoured auction / market-based pricing of spectrum, and instead allowed the 2G scam to take place. He also, in no time, revised his position from giving away 4.4 Mhz of spectrum at 2001 prices, to giving away 6.2 Mhz of spectrum at 2001 prices thus forcing an additional loss on the exchequer. The Finance Secretary in a letter dated November 22, 2007 (Annexure A1) to the Telecom Secretary had stayed any further allocation of spectrum. The communication states, “Meanwhile, all further action to implement the above licenses (cross-over technology) may please be stayed.” A copy of this letter was marked to Mr K.M. Chandrasekhar, Cabinet Secretary, and Mr Rohit Kansal, PS to Mr. Chidambaram. On November 29, 2007 (Annexure A2), Telecom Secretary replied to Finance Secretary justifying the issuance of cross-technology licenses on 2001 rates. On this letter, an officer in Finance Ministry noted, “No reply as to why a matter with financial implications has not been referred to MoF.” On 7th December 2007, an agenda for the meeting of the full Telecom Commission was prepared, which did not list spectrum pricing as an item. However, this meeting was not held. On 12.12.2007, the MoF officers wrote to the DoT, seeking details/documents related to the letter of the DoT Secretary dated 29th November 2007. On 13th December 2007, in response to a letter from the Director (Infra)-MoF, the DoT replied (Annexure A3), enclosing copies of: The cabinet note of 2003; the cabinet decision in this regard; the DO from the DoT Secretary to the Finance Secretary of November 2007. The Cabinet note and decision with regard to spectrum pricing, which had been cited by the DoT Secretary on 29th

6 November 2008 was received by the MoF. Section 2.1.2(3) clearly stated: “The Department of Telecom and the Ministry of Finance would discuss and finalize spectrum pricing formula, which would include incentive for efficient use of spectrum as well as disincentive for sub-optimal usages.” From the above, it was clear that the MoF officials were fully aware that unless such ‘concurrence’ based on discussion and finalization of spectrum pricing formula between the DoT and the MoF had been established, the DoT could not move ahead and allocate spectrum at 2001 rates in 2007/08. Alarmed by press reports between October and December 2007 of Raja's potential manipulation of cut-off date, FCFS, and the imminent issuance of LoIs, MoF officials prepared a “Position Paper on Spectrum Policy” dated January 3, 2008, which was attached to a covering note dated January 9, 2008 (Annexure A4) of the Additional Secretary (EA), Finance Ministry. This paper was to be presented in the Telecom Commission meeting that was to take place on January 9, 2008, which was postponed to January 15, 2008 at the last minute. In the paper, the Finance Ministry had recognized that 575 applications were pending and therefore had insisted that the price of spectrum must reflect spectrum’s scarcity value determined through auction. The relevant parts of this note are reproduced below: Extracts of notes dated January 9, 2008 of Additional Secretary (EA), of Finance Ministry 6.3 Given the fact that there are reportedly over 575 applications pending with DoT (including 45 new applicants) there is a case for reviewing the entry fee fixed in 2001. This is an administratively fixed fee. Therefore any change should be governed by transparent and objective criteria applicable uniformly to all new entrants. 8.1 The most contentious issue relates to spectrum allocation.

There is no disagreement that the price charged for spectrum should be based on its scarcity value, efficient usage and that the process of allocation should be transparent and fair. The payment is for a real economic resource. It is not a fee. According to DoT it is closer to royalty charged on Coal, Crude and Natural Gas. 8.4 The most transparent method of allocation of spectrum

would be by auction. However, there are two caveats to the auction method.

7 (a) The ways in which the existing licensees in GSM and CDMA would be eligible to participate in the auction vis-a-vis the new entrants; and (b) The advantages and disadvantages of the method itself. A detailed table is placed at Annexure V. The possible non-optimal outcomes can be taken care of by prescribing suitable rules of auction before the bid in a transparent manner applicable to all eligible bidders. Any other method for allocating spectrum, being a scarce resource, would be economically inefficient. 9.1 …. Nevertheless, regardless of the allocation criteria, auction

has been recommended with transparent rules as the most suitable method of allocating spectrum. The quantum, of spectrum available for auction in 2G is to be decided by DoT. Also, the above said note clearly states that Mr. Chidambaram was personally keeping a watch on the spectrum issues through the media reports. The note stated that, “FM had instructed that the prolific Press reports over the last two months relating to pricing of spectrum and the "Telecom Wars" may be tracked.” A sample of the press reports of that time that had complete blown the lid over the manipulations and illegalities that were being done by the DoT much before the issue of LoIs are annexed as Annexure A5. There were tens of other similar reports appearing in the press during October 2007 to January 2008. So, Mr. Chidambaram was fully aware of the complete developments that were taking place in the Department of Telecommunications (DoT). He was also aware that the TRAI recommendations (that DoT claimed to be following) were never approved by the full Telecom Commission of which Finance Secretary is a Member. Additionally, that Member (Finance) on the Telecom Commission had objected to Mr. Raja's moves by opposing the 2001 entry fee vide her note on file dated 30th November 2007. The DoT issued 122 Letter of Intents (LOIs) for Universal Access Service (UAS) licenses on January 10, 2008; these LOIs were converted into licenses only during February 27, 2008 to March 7, 2008; and the spectrum allocation started only from April 22, 2008 and completed on May 6, 2009 (Annexure A6). During this period, Mr. Chidambaram had enough time to stop the scam. However, instead, he facilitated the same by silencing the stand of his officers on the issue of spectrum pricing.


Just before the Telecom Commission meeting that was scheduled for January 15, 2008, Mr. Chidambaram wrote a note for the Prime Minister (Annexure A7). Instead of being straightforward, Mr. Chidambaram’s note was aimed to hide the illegalities in the award of licenses. In this regard, the relevant extract of the note where he categorically exempts the revision of entry fee is reproduced below: 9. This note does not deal with the need, if any, to revise entry fee or the rate of revenue share. This note deals with spectrum charges for 2G spectrum. 10. Spectrum is a scarce resource. The price of spectrum should be based on scarcity value and efficiency of usage. The most transparent method of allocating spectrum would be through auction. The method of auction will face least legal challenge. If the government is able to provide sufficient information on availability of spectrum, that would minimize the risks and consequently, fetch better prices at the auction. The design of the auction should include a reserve price. Through the above note, Mr. Chidambaram also put a lid on the issue of entry fee for start-up spectrum and of payment by existing operators towards excess spectrum from a retrospective date, probably to appease them so that they do not raise the issue of the scam in awarding new licenses. In this regard, the relevant extract of the note is reproduced below: 13. This leaves the question about licensees who hold spectrum over and above the start up spectrum. In such cases, the past may be treated as a closed chapter and payments made in the past for additional spectrum (over and above the start up spectrum) may be treated as the charges for spectrum for that period. However, prospectively, licensee should pay for the additional spectrum that they hold, over and above the start-up spectrum, at the price discovered in the auction. This will place old licensees, existing licensee seeking additional spectrum and new licensees on par so far as spectrum charges are concerned. Thereafter, both Mr. Chidambaram and Mr. A Raja met on January 30, 2008 (Annexure A8) to discuss the issue of licensing and spectrum pricing. In this meeting, Mr. Chidambaram announced the closure of the issue of reviewing the Entry Fee of 122 LoIs already issued by DoT. Even

9 after issuance of LoIs, A Raja did not convert the LoIs into licenses until he got clearance from Mr. Chidambaram. The gist of the discussions is as follows: 4. It was noted that there is a mismatch in the demand and supply of spectrum across circles. Redressing this mismatch will be another policy imperative; 5. FM said that for now we are not seeking to revisit the current regimes for entry fee or for revenue share. However, in the meantime, since the issue of spectrum pricing was apparently not settled at the Telecom Commission level, the officers in both the ministries (Telecom and Finance) kept the discussions on. The Secretaries of both the ministries had four rounds of discussions in February 2008. In this regard, on February 8, 2008 Telecom Secretary sent an “Approach Paper on Spectrum Charges” to Finance Secretary (Annexure A9). This note revealed that the Finance Ministry officials were keen to stop the allocation of spectrum to the LoI holders. Also, the DoT’s position was: i) that it agreed with the MoF that it was legally possible to auction start-up spectrum (Para 2.1); ii) that license conditions imply that start-up spectrum of 4.4 MHz would be available contractually (Para 2.1.1, 2.1.2); and iii) that it agreed with the MoF that spectrum beyond 4.4 MHz until 6.2 MHz (additional 1.8 MHz) could be charged at a pro-rata basis. The relevant part of this note is reproduced below: Extract of Telecom Secretary’s letter dated February 8, 2008 to Finance Secretary 2.1 Secretary (Finance) was of the opinion that auctioning is legally possible for initial allotment of spectrum of 4.4 MHz. Secretary (DoT) explained that auction of spectrum of 4.4 MHz though may be legally possible but it would not be practical proposition to auction or fixing a price for 4.4 MHz spectrum due to following: 2.1.1 As per clause 43.5 (i) of UAS License, which provides that: “initially a cumulative maximum of upto 4.4 MHz +4.4 MHz shall be allocated in the case of GSM based systems….” It implies that when a service provider signs UAS License he understands that and contractually he is eligible for initially a cumulative maximum of 4.4 MHz subject to availability. 2.1.2 120 LOIs have been issued and the Department is contractually obliged to give them start up spectrum of 4.4 MHz under UASL.

10 3.1.4 3.1.5 It is however, proposed to price the spectrum of 1.8 MHz The Department is of the view that it would be appropriate to a

beyond 4.4 MHz upto 6.2 MHz. levy the charge for enhancement of the quantum of spectrum beyond the initial 4.4 MHz. For an additional spectrum of 1.8 MHz making a total of 6.2 MHz spectrum acquisition charge may be on pro-rata basis i.e. Rs. 378 crores pan-India. It will be charged only to new allottees as the existing ones have got the spectrum as per license agreement. On receiving the note of 8th February 2008, the MoF officials knew that the DoT’s representation of ‘contractual rights’ of LoI holders (Para 2.1.1, 2.1.2) was farcical and a gross misrepresentation simply because LoI holders were neither licensees nor did they hold licenses until 27th February 2008. After the above stated letter from Telecom Secretary, the officials in the Finance Ministry to counter the above also made an internal note dated February 11, 2008 (Annexure A10) reiterating their stand of market-based spectrum pricing of 4.4 MHz spectrum agreed to be allotted to 122 LoI holders. The relevant part of this note is reproduced below: 30. Ministry of Finance differs from the above position of DoT.

There is no contractual obligation to allot a start-up spectrum of 4.4 MHz to every licencee free of cost. The entire range of the spectrum allotted should be priced. The issue of level playing field can be addressed by charging this price even on existing operators. 31. Moreover, the differentiated pricing suggested by DoT, viz. one price for spectrum between 4.4 and 6.2 MHz and a different price for spectrum beyond 6.2 MHz will be clumsy, nontransparent and legally questionable. It will be neat and transparent to fix a single circle-specific price for spectrum across the entire bandwidth. Between 27th February and 7th March 2008, even as MoF officials fought a valiant battle to protect the exchequer’s revenue, not just with the DoT but with their own Minister, Mr Raja went ahead and issued 122 licenses. This could have easily been prevented by the FM if only he had stood by his officials. But all his notes and agreements (15th January and 30th January 2008) were against revising entry fee.

11 On 7th April 2008, the Finance Secretary discussed with the DoT Secy and the FM the note on the issue of entry fee/spectrum pricing (Annexure A11). He noted that: “Pricing of spectrum: DoT is agreeable to pricing of spectrum beyond 4.4 MHz but wants this to be deferred till auction of 3G and WiMax is completed. In our note, we suggested pricing of all spectrum including spectrum already allocated. Is there a case for deferring this decision? Is there merit in disclosing the pricing intention right now if actual implementation is deferred?” It is thus clear that the Finance Secretary was uncomfortable about diluting the MoF’s position and more so on the ‘merits in disclosing the pricing intention right now if the actual implementation is to be deferred’. The Finance Secretary also noted on the covering letter: “I have only communicated the gist of this to Secretary, Department of Telecom. The FM said that he will also speak to Minister of Communications.” On the same day of 07.04.2008 , the FS noted on a file noting (Annexure A12) continued from 3rd April 2008 that: “2. FM agreed that spectrum usage charge should be increased reflecting the scarcity value of spectrum as indicated in our note of 11th February, 2008. 3. On pricing of spectrum, FM’s view is that we must insist, in principle, on pricing spectrum (beyond 4.4 MHz) although details can be worked out after the auction of 3G spectrum.” This was the first clear dilution of the MoF officers’ position on specifically pricing start-up spectrum on the instructions of Mr. Chidambaram. Mysteriously, Mr. Raja did not start the process of allocating spectrum at this stage. Clearly, he needed a written confirmation from the MoF to begin the process of allocating 4.4 MHz of start-up spectrum at 2001 rates. On 8th April 2008, one month after licenses had been awarded, an OM (Annexure A13) which reflected the MoF’s original position of 11th February 2008 on the issue of subjecting the entire spectrum to specific pricing was issued to the DoT Secretary by the Director, MoF. This note came to light in the media on 9th April 2008, and the DoT’s position vis-àvis that of the MoF’s view were highlighted. Immediately on seeing the media coverage, the officer was reprimanded and was forced to withdraw and re-draft the said OM (Annexure A14). The difference between what the original OM stated and what the officer was directed to re-draft could not have been more stark. The original OM required the entire range of

12 spectrum to be specifically priced. The revised OM, which was prepared on 9th April 2008 but presented with a date of 8th April 2008, specifically sought to exclude start-up spectrum upto 4.4 MHz from being specifically charged, therefore ensuring that the entry fee of 2001 that was fixed by telecom Minister in 2008 was not revised. The contrast is as below: New OM dated April 8, 2008 4(1) Any allotments to licensees of 4(1) Any Allotments of Spectrum to access spectrum subscriber access subscriber licensees under UASL regime under may henceforth be specifically priced and Original OM dated April 8, 2008

UASL regime – beyond the charged for. The charge may be determined, initial “start up” allocation of Circle wise, by adopting the Entry Fee, fixed 4.4. MHz – may henceforth be for that circle in 2003-04, and thereafter specifically priced and inflating it by the multiplier, which charged for. Details in this represents the growth in aggregate AGR per regard can be worked out. MHz between 2003-04 and 2007-08; hence, for a Pan India operator, the Circle fee fixed in 2003-04 (Rs. 375 Crore per MHz) would be inflated by a multiple of 3.5 (which represents the growth in AGR/MHz between 2003-04 and 2007-08) to yield the new Spectrum price of Rs. 1,312 Crore per MHz (approximately). 4(3) The price determined as above may be made applicable to both the new and existing operators; such operators who do not intend to pay the new charges may be given the the option of surrendering spectrum 4(2) The price determined as above may be made applicable to both the new and existing operators; moreover, the entire range of spectrum allotted may be charged, for both new and existing operators; such operators who do not intend to pay the new charges may be given the option of surrendering the Spectrum allotted to them.

allotted to them.

On 10th April 2008, not only was the officer who sent the original OM made to apologize in writing, but in fact seemed to be severely reprimanded and forced to provide a detailed explanation to the FM as to why the original OM, which reflected the views of the MoF officers/note of 11th February 2008, was sent out (Annexure A15). The note also reveals how the OM was personally delivered by the officer to the Wireless Advisor in the DoT,

13 who received it on behalf of the DoT Secretary. The DoT then did not to process the original version of the OM in the DoT file. The Joint Secretary (Infra) in the MoF spoke personally to the DoT Secretary asking for the withdrawal of the original OM and the request was exceeded to by DoT Secretary Shri Behura. While all this occurred on 9th April 2008, the new diluted/modified OM was mysteriously pre-dated one day earlier to 8th April 2008 to give an appearance that DoT’s records and files were in order. On the above note, on 16th April 2008, the FM wrote a 3-para note accepting the apology of the officer but only pointed to ‘nomenclature’ and ‘title’ mistakes in the OM. He wrote: “That apart, the draft note received from DoT was indeed considered by me on 11.3.2008. Thereafter, that file containing the draft note from DoT and the proposed OM was not put up to me. What was considered was only a non-paper given to me by the Minister of Telecommunications on which I had been informed by the FS that the DEA would send a non-paper containing our views. It is in this context that the note for discussion was prepared: a discussion took place; and I had indicated my views on the margin of that note. Logically this should have been followed by sending a non-paper to DoT. However, if there was an intention to send a formal OM containing our views on the draft note for Cabinet received from DoT, the file should have been put up to me and my signature obtained. I may note that I was in office on 8.4.2008 and 9.4.2008. Such errors should be avoided in future.” Having forced the officers to replace the original OM and change the MoF’s position, Mr. Chidambaram on April 21, 2008 forwarded a “non-paper” indicating the views of the Ministry of Finance on spectrum related matters to Mr. A Raja (Annexure A16). This non-paper was silent about on the issue of entry fee for start-up spectrum for 122 licenses already issued. The discussion conveniently shifted to charging for spectrum beyond 4.4 MHz. In this letter, he proposed a meeting with Mr. Raja before communicating their “conclusion” to the Prime Minister. That means, till then the two ministers had already decided not to charge for spectrum for 122 Licenses already issued. Extracts of Mr. Chidambaram’s letter dated April 21, 2008 to A Raja As you are aware, based on your non-paper on spectrum charges, Finance Secretary has held discussions with Secretary, Ministry of Communications & Information Technology. Based on those discussions, I enclose a non-paper containing our views on issues relating to 2G spectrum and issues relating to 3G / WiMax Spectrum.

14 2. After you have had an opportunity to examine the same,

may we meet and discuss and reach some conclusions? These conclusions could then be presented to the Hon'ble Prime Minister. Pricing of 2G spectrum DoT is agreeable to pricing of spectrum beyond 4.4 MHz but wants this deferred until auction of 3G and WiMax is completed. An in-principle decision on this issue may be taken at this stage itself, with details to be worked out later. Immediately after the above note, the DoT started allocating start-up spectrum of 4.4 MHz to all the new operators from April 22, 2008. Thereafter, Mr. Chidambaram instructed the Finance Secretary to meet the Telecom Secretary to carry forward the discussion. The two met on April 24, 2008. After this meeting, strangely, Finance Ministry took a u-turn and agreed not to charge even for spectrum allocated upto 6.2 MHz. . This meant an additional 1.8 MHz over and above the 4.4 MHz as an additional concession against the explicitly terms between the DoT and the MoF officials in their letters of 8th and 11th February 2008. The Finance Secretary issued an updated note on this on April 29, 2008 (Annexure A17), a copy of which he handed over to Mr. Chidambaram. The same position is reflected in a Brief Note dated May 28, 2008 prepared by the MoF for Mr. Chidambaram before his meeting with Mr. Raja on May 29, 2008. They then met on May 29, 2008 and again on June 12, 2008. Thereafter, on July 4, 2008, Mr. Chidambaram, Mr. Raja, Telecom Secretary, and Finance Secretary had a joint meeting with the Prime Minister. This was their first ever meeting on the spectrum issue after the award of 2G scam. By this time, LOIs were already issued (Jan 10, 2008), LoIs were converted into Licenses (Feb 27, 2008 to Mar 7, 2008), and the allocation of start-up spectrum was already started (from April 22, 2008). In the meeting, a note was submitted to the Prime Minister, which was more in the nature of informing him what was already agreed and done. No further approvals were required, as has become clear from the PM’s statement in the Rajya Sabha on 24th February 2011. The specifics of the discussion are reflected in the Finance Secretary’s note of July 6, 2008 (Annexure A18). Relevant part of the note dated July 6, 2008 states, “It is legally and administratively tenable to impose a two part tariff for Spectrum: a fixed, one-time "upfront" spectrum price for allowing the allottees to use a public resource for private profit; and, a recurring spectrum usage charge, whereby Government

15 shares the profits accruing to the operator. However, due to historical legacy reasons, spectrum allocations upto 6.2 MHz for GSM (5 MHz for CDMA) shall not be charged both from new and existing operators.” The change in stand by Mr. Chidambaram has also been adversely commented by the CAG in its report dated November 16, 2010 that states: “The Hon'ble Finance Minister also held the view (15 January 2008) that “Spectrum is a scarce resource. The price for spectrum should be based on its scarcity value and efficiency of usage and the most transparent method of allocating spectrum would be through auction”. However, the Hon'ble Finance Minister after the issue of 121 LOIs by the DoT suggested in January 2008 to treat the previous issue of licences as a closed chapter and recommended that the price of spectrum be discovered through an auction process in future. Relevant extract from the CAG report is annexed as Annexure A19. On February 16, 2011 (Annexure A20) the Prime Minister held a briefing with select media persons in which he confirmed that the two ministers were in agreement with each other. The briefing states, “And this was also discussed with the Finance Ministry because in terms of the Cabinet decision of 2003 the pricing and allocation of spectrum was to be settled between the Ministry of Finance and the Telecom Dept. Initially, of course, the Finance Ministry did ask for a high price of spectrum but after many discussions, the two ministries agreed that as far as 2G is concerned, we have to live with the present system particularly with regard to the amount of spectrum that is built and embedded into a license agreement. So this is the background why I did not proceed further with this matter of pricing of spectrum, because if the Ministry of Finance and Ministry of Telecom both agree and they have the obligation of the Cabinet Decision of 2003 to decide on the matter and also since TRAI is an expert body and Telecom Commission has experts, if all of them are of the same view, I did not feel I was in a position to insist that auctions must be insisted.” Prime Minister also told Rajya Sabha on 24.02.2011 that “The government policy on pricing of spectrum was taken on basis of the Cabinet decision of 2003, which specifically left this issue to be determined by the Ministry of Finance and the Ministry of Telecommunications.” He further added “the

16 two Ministers had agreed because of legacy considerations and I accepted the recommendation.” Former Finance Secretary in his statement on March 5, 2011 (Annexure A21) to the CBI has confirmed the entire sequence of events and the relevant file notings. Thereafter, on March 25, 2011 (Annexure A22), the finance ministry under its new minister, released an O.M. to the Prime Minister Office titled, “Chronology of basic facts related to pricing and allocation of 2G spectrum.” This paper (that was drafted after interministerial consultations and refers to about 40 documents) indicts the then Finance Minister in clear terms and confirms the events as are documented above in this application, including (in Para 17) the fact that even after licenses had been issued, the 2G scam could have been prevented by invoking Clause 5.1 of the UAS license. Firstly, the said O.M. notes that Mr. Chidambaram had four months to stop the scam even after the issuance of 122 Letter of Intents (LoIs) by telecom ministry on January 10, 2008. The LOIs were converted into licenses during February 27 to March 7, 2008, while the spectrum was allocated only from April 2008 onwards. Secondly, in the meeting of Telecom Commission held on January 15, 2008, the representative of the finance ministry did not bring up the revision of the 2001 entry fee for start-up spectrum. Thirdly, simultaneously, in a secret note of January 15, 2008 to the PM, P Chidambaram had stated that this note was not seeking to revise the entry fee, and that in future all spectrum beyond “start-up” should be auctioned, and the spectrum allocated in the past be treated as a closed chapter. Fourthly, Mr. Chidambaram had a meeting with the accused Mr. Raja on January 30, 2008, in which Mr. Chidambaram specifically stated that he was not seeking to revisit the current regime for entry fees and revenue share. Fifthly, in February 2008, the FS informed the Secretary, DoT that auctioning start-up spectrum was legally possible. Sixthly, on February 11, 2008 the MoF officers rejected the DoT’s proposal of 8th February 2008 and instead proposed to charge the entire range of spectrum for all telecom operators, new or old, by indexing it with the increase in telecom revenues during the period 2003-04 to 2007-08. Seventhly, the FM forced the FS to change the MoF’s position with regard to specific charge/auction of spectrum till 4.4 MHz – based on which the MoF took a u-turn and wrote a modified OM to the DoT on 9th April 2008 (but dated 8th April, 2008), agreeing to specifically price spectrum only beyond 4.4 MHz toeing Mr. Chidambaram’s line. Eightly, on April 21, he 2008 Mr. Chidambaram had written to Mr Raja, and in this letter,

17 mentioned only about pricing of spectrum beyond 4.4 MHz. And finally, even this agreement between the DoT and the MoF was reversed within 3 days, and it was decided to price spectrum only beyond 6.2 MHz, thus placing an additional approximate 500 MHz (280 licenses x 1.8 MHz) outside the pricing range, in spite of this being an offer by the DoT itself vide its letter of 8th February 2008. In that, the MoF was forced to grant concessions even ahead of the DoT’s own proposals. The Government of India issued a press release on 10.12.2011 (contrary to the PM’s media statement of 16th February 2011, and his statement in the Rajya Sabha on 24th February 2011, and the DoT affidavit of 11th November 2010) strongly defending Mr. Chidambaram by stating: “It will be clear from the foregoing sequence of events that Shri P Chidambaram was in no way responsible for the issue of LoIs on January 10, 2008 or the charging of entry fee of about Rs.1650 crore. In fact, the record will show that the Ministry of Finance had no knowledge that the LoIs would be issued on January 10, 2008.” A copy of the said official press release is annexed as Annexure A23. The fact that Government took a false defense shows that it has a lot to hide and therefore further investigation becomes imperative. It is to be noted that Mr. Raja has been charge-sheeted by the CBI for fixing low spectrum price. Mr. Chidambaram, as the above facts show, was equally guilty of the same.

2. Allowing sale of equity by Swan and Unitech Both Swan and Unitech had obtained 2G licenses and spectrum in 2008 at throwaway prices because of the connivance of Mr. Chidambaram and the then Telecom Minister Mr. Raja. That was the first part of the 2G scam. The second part of the 2G scam took place later in 2008. Mr. Chidambaram allowed the companies like Swan and Unitech to sell off their stakes, without charging any Government’s share of its premium on account of spectrum valuation and without enforcing his own agreement with the then Telecom Minister dated 30.01.2008. On 30.01.2008, Mr. Chidambaram and Mr. Raja met and concluded that 14 operators were too many for the Indian market and that several of the new entrants had come in for ‘speculative reasons’. Further, they knew full well that these companies would enter into M&As and make windfall

18 profits because of the premium linked to the spectrum that they had received in 2008 at 2001 prices. They made detailed notings and agreements about how such premium resulting from M&As, being linked almost entirely to the value of spectrum, must be appropriately subjected to a government’s share and after proper and official valuations. No M&A in the telecom sector can take place without the consent of the DoT, as per the license conditions. On 30th January 2008, in his documented meeting (annexed above) with Mr. Raja 20 days after the 2G scam took place and LoIs had been granted, but no licenses or spectrum allocated yet, a detailed discussion on spectrum and M&As occurred. The notes from the meeting between the FM, the MoCIT, and attended by the Finance Secretary and the DoT Secretary concluded on the issue of M&As, speculative operators, and protecting government revenues that: “2.4. In case of M&A, getting part of the valuation for government as premium for spectrum, to avoid hoarding as well as spectrum trading: In view of very large number of new operators, it is expected that some of these companies might have obtained licenses as ‘speculative’ venture. Hence, some ‘mergers and acquisitions (M&As)’ are likely to take place after some time, which de facto, would amount to spectrum trading, as large part of such company’s valuation may be on account of the spectrum held by them. This spectrum trading is not desirable and needs to be regulated. Besides, the general conditions in service license and other guidelines for M&As, clear detailed ‘Guidelines’ needed to be evolved and announced regarding the M&As, especially the amount of spectrum which the merged entity would be allowed to retain alongwith other criteria such as other details in this regard; company’s valuation by consultants/valuers appointed by govt’s approval/consent/concurrence; and then payment of a part of the valuation to govt. as premium for spectrum, etc.” The above clearly shows that both ministers were specifically aware that M&As would lead to windfall gains for these companies. In fact, the Supreme Court, in its judgment dated 2nd February 2011 in WPC 423/2010 cited as ((2012) 3 SCC 1) while cancelling the 2G licenses has held on the issue of sale of stakes by these companies that: “This becomes clear from the fact that soon after obtaining licenses, some of the beneficiaries off-loaded their stakes to others in the name

19 of transfer of equity or infusion of fresh capital by foreign companies, and thereby made huge profits. We have no doubt that if the method of auction had been adopted for grant of licenses which could have been the only rational transparent method for distribution of national wealth, the nation would have been enriched by many thousand crores.” In fact, the CBI, in its charge sheet of 2nd April 2011 in the 2G scam matter, has, in Section C (dual technology approvals and spectrum allocation), clearly specified “a gain of Rs. 2,342 crores to the promoters of Unitech Wireless,” and in the case of Swan-Etisalat, it specifies “a premium of Rs. 275.7178 on each share”. The CBI itself, as a part of the criminal conspiracy, has shown massive profits made by these companies. Further, the same has been accepted by the Learned Special Judge of the CBI Court in the order framing charges of 22nd October 2011, where he has concluded: “...M/s Swan Private Limited and M/s Unitech Limited, and thereby two companies obtained pecuniary advantage to the tune of Rs. 7,105 crore by offloading their shares...”. On 8th February 2008, the DoT submitted an approach paper (annexed above) in which it also specifically addressed the issue of M&As, in that: “In view of this we need to have clear guidelines relating to M&A. We also need to consider fees on account of transfer of spectrum to a merged entity. In the event of M&A, the transfer charge to the government has not been considered by TRAI in their recommendation of August 2007. This is a complex issue requiring detailed deliberation and consultation. Therefore, the issue of quantum of fees that the government would get on account of transfer of spectrum during M&As need to be referred to TRAI. Based on the recommendations of TRAI on the above issue, DoT will take appropriate decisions within a specified period and issue clear and transparent guidelines for M&A including transfer charges for spectrum.” On 11th February 2008, in the DoT’s internal note (annexed above) prepared based on the meeting between the FM and the MoCIT on 30th January 2008, three rounds of discussions between the FS and the DoT Secretary as well as the approach paper of the DoT dated 8th February 2008, it was concluded that M&As were expected and that the government must find a way to protect its revenues. It specifically stated that:

20 “One question that arises is whether the government should get premium out of an M&A transaction. Since spectrum has not been auctioned but priced heuristically, it is likely that rent if any, involved in the price of spectrum will form part of the M&A transaction.” On 28th May 2008, one day before a scheduled meeting between Shri Chidambaram and Shri Raja, a briefing note was prepared for the FM (Annexure A24) in which, again, on the issue of government revenue from M&As, it was stated that: 10. DoT have issued notification on April 22, 2007 on ‘guidelines for intra circle merger of cellular mobile telephone service (CMTS)/unified access service (UAS) licenses’ (copy attached). The guidelines mandate: a) Spectrum transfer charge’ to be payable as specified by government. 11. DoT may be advised that the fixation of ‘spectrum transfer charges’ shall be in consultation with DEA.” It is a matter of record that Mr. Chidambaram and Mr. Raja met on 29th May 2008, on 12th June 2008 and finally with the PM jointly on 4th July 2008. However, from the notes of this meeting dated 6th July 2008, it is clear that the entire issue of subjecting M&As to the government’s share of the premium from the sale of spectrum / spectrum transfer charge was specifically left out of the discussion. On 23rd September 2008, Swan Telecom, which had received spectrum in only 9 out of the 13 circles in which it had received licenses, entered into an M&A transaction with Etisalat International. Similarly, on 29th October 2008, Unitech entered into an M&A transaction with Telenor even though it had received spectrum in only 13 out of the 22 circles. In the days following these transactions, several press clippings appeared exposing the loss to the exchequer, and questioning the government’s move of allocating spectrum at 2001 prices, including the false promise of doing so under the pretext of affordability and increasing teledensity etc. The articles clearly questioned the loss to the exchequer. A sample of these press clippings is annexed as Annexure A25 (colly). On 4th November 2008, under pressure from the media, Swan and Unitech were forced to report about the transactions to the DoT (Annexure A26 and Annexure A27 respectively). The intimation of the two companies showed that the only asset that they possessed at the time of the massive valuations during the M&A was the promise of spectrum. They did not

21 even have spectrum in all their circles, and consequently, did not have any telecom infrastructure or equipment either. They had no customers and therefore no revenues either. It was clear from their own letters that the entire valuation and the pecuniary advantage was linked to the price of spectrum in 2008. This, in fact, is exactly what had been expected and documented in the conclusions reached between the FM and Mr. Raja in their meeting of 30th January 2008 – which were then repeated in the DoT’s and MoF’s notes/letters of 8th February, 11th February, and 28th May 2008. Under continued pressure from the media, Mr Raja held a meeting with the FM and the PM. In this meeting, he obviously received the support of the FM. In a complete U-turn of their earlier agreement of 30th January 2008, documents suggest that the FM passed off these transactions as mere infusion of equity under the FDI rules. This free passage for Swan and Unitech became a cause of additional and massive loss to the exchequer. On 5th November 2008, Mr Raja penned down a one-page note (Annexure A28), describing his meeting with the FM and the PM. In face of the media articles pointing to the ‘unlawful enrichment’ and specified that: “In a meeting, the Hon'ble Finance Minister clarified that the dilution of share to attract foreign investment for business expansion did not amount to sale of license and as such these companies did their share dilution as per corporate laws. Nevertheless, I suggest that in order to remove suspicious clouds in the minds of media and people, Telecom Commission may deliberate this issue and restrict outright sale of licenses and selling of stake by promoters to second party for money.” Thereafter on November 7, 2008 the DoT in a Press Release (Annexure A29) justified the part-equity sale of Swan and Unitech to Etisalat and Uninor. They claimed “This matter has been discussed and clarified with the Finance Minister.” The same thing is mentioned in a note dated November 7, 2008 (Annexure A30) that was prepared by the DoT for Full Telecom Commission meeting. Thus Mr. Chidambaram, apart from giving spectrum to shady companies at low prices, also allowed them to sell it off at many times the said price, thus allowing them to make windfall gains. The above facts clearly demonstrate that the actions of Mr. Chidambaram led to massive loss to the public exchequer and a corresponding gain to a few private companies and individuals, and those decisions were also detrimental to public

22 interest. Therefore, he clearly abused his position to the benefit a few private parties, which is a clear offence under Section 13 (1) (d) of the Prevention of Corruption Act.

3. FIPB approval to Hutch-Vodafone The Government had capped the Foreign investment in Indian telecom operating companies through direct and indirect route at 74 per cent. However, Hutchison Essar Limited (HEL), an operator that provided telecom services across India, breached this condition with Foreign Investment in HEL as high as 89 per cent. Hutchison Telecommunications International Limited (“HTIL”), a Hong Kong based company, had 67 per cent in HEL while Essar through its Mauritius based companies had 22 per cent equity in HEL. HTIL though had 67 per cent foreign investment but it had declared to Indian authorities that it had only 52 per cent. The remaining 15 per cent it held through three Indian entities (Mr Analjit Singh, Mr Asim Ghosh, and IDFC). The above breach came to light only when HTIL announced the sale of its entire equity of 67 per cent to Vodafone of UK on February 11, 2007. This is revealed in Vodafone’s Press release dated February 11, 2007 (Annexure A31), and also Hutchison announcement on Hong Kong Stock Exchange through a presentation paper dated February 22, 2007 (Annexure A32). Telecom Watchdog, an NGO, immediately brought this to the notice of the concerned agencies in India including the Enforcement Directorate (Annexure A33). Thereafter, the Department of Economic Affairs (DEA) under Ministry of Finance held detailed discussions with all the concerned parties – Hutchison, Vodafone, and all the three Name Lenders. Vodafone vide its letter dated March 14, 2007 confirmed its intention to acquire 67 per cent stake (Annexure A34). The DEA also sought the opinion of RBI and Law Ministry on this issue. It circulated the details to all the Members of the Foreign Investment Promotion Board (FIPB) for their comments. However, all the other Members of the FIPB authorized DEA to investigate. At this stage, Hutch realized the gravity of this situation. On March 15, 2007 Hutch agreed to pay $415 million to Essar in a conditional Settlement Agreement with Essar (Annexure A35). This was primarily to secure Government permissions. Out of this 90 per cent ($373.5 million) was immediately paid and the balance 10 per cent ($41.5 mn) was to be paid later.

23 On the other hand, responding to DEA’s queries, the RBI in its letter dated March 20, 2007 called this as a serious violation, and said it requires further investigation (Annexure A36). However, Law Ministry gave a different opinion and said it was not in violation of FIPB. With all these inputs, including that of Law Ministry’s opinion, the DEA on April 26, 2007 had concluded that HTIL had 15 per cent benami shares. However, on April 27, 2007, the Finance Minister Mr P Chidambaram called these DEA officers in his office including the Finance Secretary. Later, on the same evening, the FIPB held a meeting. Most of the Members of FIPB recorded their serious observation, but allowed transfer of only 52 per cent of Hutch to Vodafone, while it rejected 15 per cent share transfer to Vodafone. Under pressure, it did not act and remained silent on the benami holding. This is revealed in the notings of DEA received under the RTI Act (Annexure A37). On May 7, 2007 the FIPB gave conditional permission to Vodafone to purchase 52 per cent of Hutch while putting restriction on the sale of benami 15 per cent (Annexure A38). However, without caring for this condition, Vodafone executed the purchase as per original plans and purchased the entire 67 per cent. This violation too was again immediately brought to the government agencies including Mr A Raja, the then Telecom Minister (Annexure A39). However, no action was taken. Later on, Vodafone also entered into another agreement with Essar called Amended and restated Shareholders Term Sheet dated August 24, 2007 by way of which it has fixed how to share cost if at a later stage the Government finds that the shareholding is benami (Annexure A40). This agreement has capped Essar’s liability to $415 million that it has received from Hutch under the above stated conditional Settlement Agreement. In other words, if Essar is unable to secure the complete go through, it must return $415 million to Vodafone. For extending support, Vodafone also arranged a loan of $3.5 billion Term Loan on its sureties for Essar. For this, Essar, Vodafone, and banks entered into agreement in September 2007 (Annexure A41). This agreement also reveals that Vodafone has purchased 67 per cent from Hutch. It also elaborates how to deal with a situation when the Government finds that they have 15 per cent benami shares. Later, on February 13, 2009, the government relaxed Foreign Investment cap through Press Release No. 2 of 2009. This allowed further formal taking over of another 6 per cent by Vodafone from the Name Lenders – Mr Asim Ghosh (2.29 pc) and Mr Analjit Singh (3.71 pc) out of the total 15 per cent benami by paying them a substantial money for lending their names.

24 Vodafone paid Mr Asim Ghosh Rs 329.5 crore and Mr Analjit Singh Rs 533.3 crore. Thus, together they sold 6 per cent for Rs 862.8 crore. This works out to be Rs 143.8 crore per one per cent of HEL/VEL. This means the valuation of 100 per cent of HEL/VEL was just Rs 14,380 crore. This is highly undervalued. This substantiates the allegation that these are just Name Lenders, and the payment was made by Vodafone to them as their booty for lending their Names. Thus, from the above it is clear that the Finance Ministry officials maintained the same position even just a day before the FIPB meeting was scheduled for April 27, 2007. On that morning, Mr P Chidambaram called these officers in his chamber, and after that these officers took u-turn and granted permission Vodafone to buy only 52%. The FIPB communicated this to Vodafone in May 2007. complaints. It is also clear that, in March 2007, Hutchison, in an agreement with Essar, agreed to pay $415 million to Essar for arranging government permissions. This agreement was restated by Vodafone after they purchased 67% equity, and Essar agreed to return all the money in case it fails to do so. So, this was apparently the bribe money ($425 mn) that was prima facie used by Essar to purchase permissions. These above facts therefore undoubtedly need a thorough independent investigation. But, Vodafone continued with its acquisition plan of 67%. The Government did not do anything despite the

4. FIPB approval to Aircel-Maxis Under the law, foreign share holding of a telecom company cannot be more than 74%. Any foreign investment of 50% or more have to be cleared by the Foreign Investment Promotion Board (FIPB) which is headed by the Finance Minister. The first job of the FIPB is to ensure that the FDI cap of 74% is not violated. Maxis, a Malaysian company, purchased an Indian telecom company called ‘Aircel’ and its investment was almost 100%. But to circumvent FDI cap of 74%, it routed the balance investments through Chennai based Reddy Group (Apollo Hospital). To the Indian authorities, Maxis maintained that it has only 74% in Aircel. This FDI violation can also be established from the fact that Maxis invested several thousand crores of

25 Rupees in Aircel, whereas Reddy’s investment is just Rs 34.17 crore for a stake as high as 26% in Aircel. CBI has now filed an FIR on the above transaction (Annexure A42). The said FIR states: “M/s Aircel was taken over by M/s Maxis Communications through its subsidiary M/s Global Communications along with its India partner M/s Sindiya Securities vide a complex equity structure giving them 74% and 26% stake in M/s Aircel Televentures Ltd. respectively. Whereas the investment made by them were US $ 792.41 million and US $ 7.59 million respectively thereby giving M/s Global Communications an economic interest of 99.3% in M/s Aircel Televentures Ltd.” Even to the Bursa Malaysia Stock Exchange, Maxis in its quarterly report ended March 31, 2006 has declared that it has 99.3% investment in Aircel. (Annexure A43) But despite the above well-known facts Mr. Chidambaram went ahead and accorded FIPB clearance on 03.10.2006. (Annexure A44). Also after complaints were filed regarding this FDI cap violation, no inquiry was done or ordered by Mr. Chidambaram or the DoT. After the Maxis took control over Aircel, Mr. Maran got spectrum pricing out of agenda of the Group of Ministers (GoM). The record shows the Finance Ministry under Mr. Chidambaram maintained a temporary silence on the issue of spectrum pricing being dropped from the GoM between February 2006 and February 2007. This was the same period in which Maxis received two sets of FIPB clearances in January-March and September-October 2006, followed by 14 licences between December 5 and 14, 2006, along with the promise of linked 2G spectrum at 2001 rates on a first come, first served basis. Aircel paid Rs. 1,399 crore for these 14 licences which the CAG, in 2010, valued at roughly Rs. 13,000 crore. Once Aircel had secured its licences, the Finance Ministry suddenly went back to arguing that spectrum pricing be included in the ToRs of the GoM on spectrum. While the above was happening, Mr. Karti Chidambaram (son of Mr. Chidambaram)’s company M/s Advantage Strategic Consulting gave a mysterious loan of Rs. 26 lakhs to Aircel. Around this time there was a 5% (Rs 18 lakhs) increase in Aircel’s share capital. These shares were

26 apparently allotted to companies linked with Mr. Karti Chidambaram. Documents on this along with a summary are annexed as Annexure A45. After the above facts came to light, Mr. Chidambaram argued that Karti's Ausbridge came to Advantage Strategic Consulting only in 2008/2009 by taking 67% shares. The Loans and Advances to Aircel took place somewhere before 31 March 2006 and at that time Mr. Karti had no role in M/s Advantage. But the Attached Annual Return 2006-2007 of Karti's Ausbridge Holdings (where Mr. Karti holds 94% share) shows that their email id as: advantconsult@gmail.com (Annexure A46). And Advantage Strategic Consulting's Letter Head available at RoC says their website is www.advantconsult.com (Annexure A47). The above facts leave no room for doubt that a thorough and impartial investigation is necessary in this case.

5. UNWARRANTED ATTEMPTS TO WITHDRAW PROSECUTION Mr. Chidambaram was known to one Mr. S P Gupta, a Delhi based hotelier. Mr. Chidambaram had also appeared for him several times a lawyer, including in cases where Mr. Gupta had sought quashing of FIRs against him. Mr. Chidambaram had appeared for him till 2004 when he became a minister. As many as four FIRs were registered against Mr. Gupta and others. In all the cases Delhi Police had filed detailed chargesheets leveling serious charges against Mr. Gupta and the trial court had taken cognizance. Mr. Gupta had gone right up to the Supreme Court to get the investigations and/or the chargesheets quashed. His all petitions and appeals had been rejected. But as soon as Mr. Chidambaram took over as Home Minister, Mr. Gupta wrote to his Ministry seeking withdrawal of the cases against him. Soon thereafter, Mr. Chidambaram instructed the Delhi Police (which works under him) to withdraw all the cases against Mr. Gupta. This is a clear case of abuse of ministerial power to benefit an industrialist facing 4 chargesheets. After the above facts became a big public scandal, the order to withdraw the prosecution has been revoked. There are four cases registered by Delhi Police against Mr. S P Gupta and other private individuals. In all the four cases, chargesheets had been filed, the trial court had taken cognizance, and the High Court and Supreme

27 Court had dismissed challenges to the FIR & chargesheets. Facts of the case are as follows: FIR No. 90/2000 a) FIR was registered on 14.02.2000 b) Chargesheet was filed on 17.01.2003 u/s 420/406/409/468/471/477-A/120-B IPC: It charged Mr. S P Gupta and others of M/s Sunair Hotels, Barakhamba Road, New Delhi with cheating, criminal breach of trust, forgery, falsification of accounts and criminal conspiracy. c) Trial Court took cognizance of chargesheet and issued summons to accused on 18.01.2003 d) Notice was issued on 04.03.2003 by Delhi High Court on petition challenging chargesheet e) Supplementary Chargesheet was filed on 18.08.2005 f) HC petition challenging chargesheet withdrawn on 04.03.2010 g) HC petition challenging summons dismissed on 04.06.2010: The HC order states “Learned counsel for the petitioner states that they should be permitted to question and to challenge the summoning order which was passed on 18.01.2003 on merits. I do not think this should be permitted. As noticed above, the summoning order was challenged in petitions which had remained pending in this court from 2003/2006/2007 till 04.03.2010. The petitioner then withdrew these petitions as pointed out above. It will not be proper to allow the petitioner to once again raise the same questions after they had withdrawn the petitions, which had remained pending in the High Court for 3-6 years. In these circumstances the petition is dismissed.” h) SC dismissed appeal and upholds above HC order on 09.08.2010 FIR No. 99/2002 a) FIR was registered on 19.02.2002 b) HC dismissed petition against the FIR on 24.03.2005 c) SC dismissed appeal challenging above HC order on 03.07.2006 d) Chargesheet was filed on 16.01.2007 u/s 420/406/409/424/467/ 468/471/471A/120-B IPC It charged Mr. S P Gupta and others of M/s Sunair Hotels, Barakhamba Road, New Delhi with cheating, fraud, criminal breach of trust, forgery, falsification of accounts and criminal conspiracy. e) Trial Court took cognizance and issued summons to accused on 12.03.2007

28 f) HC petition challenging chargesheet was withdrawn on 04.03.2010 FIR No. 148/2002 a) FIR was registered on 28.02.2002 b) Chargesheet was filed on 17.01.2006 500/120-B IPC: u/s It 384/406/409/417/422/465/468/471/

charged S.P. Gupta and others for extortion, criminal breach of trust, cheating, fraud, forgery and criminal conspiracy c) Trial Court takes cognizance and issues summons to accused on 13.02.2006 d) Supplementary Chargesheet was filed on 22.10.2007 e) HC dismisses petition challenging summons on 02.07.2009 f) SC dismisses appeal against the above HC order on 29.01.2010 g) HC petition challenging FIR was withdrawn on 04.03.2010 FIR No. 315/2005 a) HC directs registration of FIR on 24.08.2005. The HC order states: “It is submitted that certain official files regarding the Department of Company Affairs have been recovered from the accused persons but no action has been taken by the police… Having heard counsel for the petitioner, in the event, during investigation and search/seizure, any document or register is seized relating to Department of Company Affairs and cognizable offence is disclosed, the police, shall register an FIR and proceed in accordance with law.” b) Petition seeking quashing of FIR dismissed as withdrawn by HC on 04.03.2010 c) Chargesheet filed on 30.08.2011 u/s 380/411/120-B IPC: It charged S. P Gupta and others for committing theft and criminal conspiracy. d) Trial Court takes cognizance and issues summons on 15.09.2011 Mr. S P Gupta and others had been chargesheeted by the Delhi Police of which trial court had taken cognizance for inter-alia: a) b) c) d) Misusing the names of Mr. Rajiv Gandhi and Mrs. Sonia Forging letters of many Members of Parliament Stealing of 21 files from Ministry of Corporate Affairs Many instances of cheating, forgery and fraud Ganhi on the letter-heads.

29 Chidambaram seems to have put pressure on the Delhi government to drop three FIRs against Mr Gupta. An application was filed on behalf of the Delhi Government to withdraw some of these cases. However, the application for withdrawal was itself withdrawn after this scandal hit the media. He thus abused his position as the Home Minister to get cases against his erstwhile client withdrawn after his client failed to have them quashed through the courts. Copies of the newspaper reports are annexed as (Annexure A48). This also amounts to criminal misconduct and needs a thorough investigation.

30 Mr. Pranab Mukherjee In July 2005, the Indian Express published a report that some documents belonging to the Navy were leaked through a pen drive. This pen drive was later found in the house of a Navy officer Wing Commander SL Surve. These documents had been shared with Mr. Abhishek Verma, Mr. Ravi Shankaran and Mr. Kulbhushan Prashar— accused in various defense scams. In its investigations the Navy found three commanders, Mr. Bijender Rana, Mr. Vinod Kumar Jha and Captain Kashyap Kumar, guilty and they were sacked in December 2005. The investigation revealed that the officers had leaked sensitive information about country’s naval strategy and therefore put the security of the nation under threat. Despite the findings of the Navy’s investigation no action was taken against the trio— Mr. Abhishek Verma, Mr. Ravi Shankaran and Mr. Kulbhushan Prashar. Neither was the case handed over to the CBI. The matter was closed. The Outlook in 2006 came out with its stories stating that the leaked documents also contained information about the money exchanged as commission in Scorpene submarine. During the investigation of the Navy document leak many emails were also found which indicate that the deal to procure the Scorpene submarines which was entered into between the UOI and Thales (a French Company) on 7th October 2005 was mediated by the middlemen who have negotiated substantial commissions in the deal extensively on behalf of persons in the Government and the ruling party in total violation of the policy of the Defense Ministry which prohibits involvement of any un-registered middlemen in any Defense deal. Copies of the stories published in Outlook Magazine on 20th Feb. 2006 and 27th Feb. 2006 are enclosed herewith as Annexure A (Colly). In one of the emails, Mr. Verma wrote to chief of Thales (the French company which had bagged the contract for the Scorpene submarine) in response to his questions: Question 1: “He would like to talk to a person nominated by the government like a treasurer of the Congress party or any similar person. Because four per cent commission was impossible.” To which Mr. Verma replied: “After meeting those two people he would have to talk to me. I hope Thales doesn’t feel that Congress party has some shop and he is talking to them. I will represent them (Congress) in the entire deal. According to Thales how much are they willing to spend on the project?” On July 13, 2005, chief of Thales sent a mail to Mr. Verma which elaborates on the graft money given to him as commission. Below is the email: “Dear Abhishek,

31 We have made arrangements for paying 4% commission to your

representatives on the Scorpene deal. Please tell your lawyers to contact us for the paper work. Jean Paul Perrier” Despite such incriminating evidence of graft and putting the security of the nation in danger the then defense minister Sh. Pranab Mukherjee didn’t give orders for investigation into the Scorpene submarine deal. Ironically, the government gave orders to CBI to investigate how the documents got leaked but didn’t ask it to investigate the corruption charges in those documents. Copies of some of these emails are enclosed herewith as Annexure B (Colly). Ironically, on 12th February 2006, Mr. Pranab Mukherjee, who was then Defense Minister, said in a TV interview that there was no need to act against these men as the information that was leaked pertained to the commercial activities of the Navy. According to him it was commonplace for brokers to indulge in such acts in order to gain information pertaining to commercial activities. Copy of the interview telecast on a TV channel is enclosed herewith as Annexure C. After this, Mr. Ravi Shankaran was even given permission to leave the country. After much hue and cry, the government was forced to order the CBI inquiry in Navy War Room leak case but again Sh. Pranab Mukherjee made a statement in the Parliament that this inquiry was not in respect of Scorpene Submarines. Copy of the statement made by Sh. Mukherjee in the Parliament on 18th Feb. 2006 is enclosed herewith as Annexure D. In its charge sheet against Abhishek Verma and other accused in Navy War Room leak case, the CBI clearly stated that the information that was leaked was sensitive and could have posed a threat to nation’s security. The documents contained information about the future purchases and preparedness of the Indian Navy. Even though no investigation regarding ‘Scorpene’ deal has been done by the CBI, the facts which have emerged from the said charge-sheets of the CBI corroborate many of the aforementioned allegations. As per the charge sheet, Abhsihek Verma was associated with Atlas Group of companies, which deal in defense supplies and whose main source of income is through foreign remittances. It says that he received pecuniary benefits from the foreign companies having interest in various defense procurements. It has been clearly established that Ravi Shankaran, Kulbhushan Parashar and Abhishek Verma were very close to each other and all of them were associated with Atlas group of companies which deal in defense supplies. It has been established by both the chargesheets that Abhishek Verma, Kulbhushan Parashar and Ravi Shankaran were three

32 civilian beneficiaries of ‘War room Leak’. One of the most revealing finding in the second charge-sheet is the business connection of M/s Atlas Defense Systems with Thales Group of companies. Further, the second Charge sheet also proves that Abhishek Verma has connection with Ms. Gwendolyn Berger who was acting as ‘International Liaison Officer’ for Thales as apparent from her business card. It appears from the 1st chargesheet that much of the evidence was destroyed because of delay in ordering an investigation. Copies of the charge sheets filed in Navy War Room leak case are enclosed herewith as Annexure E (Colly). A Public Interest Litigation was filed by an organization viz. Centre for Public Interest Litigation in the Delhi High Court seeking an independent investigation into the allegations of payment of commission in the Scorpene submarine deal. Pursuant to the High Court order the CBI conducted a preliminary enquiry and filed a report before the court. It appears that the CBI did not do any investigation into the emails, phone records of the accused etc. and closed the case saying that no evidence was found. The petitioner in the said PIL specifically asked for the CBI report but the same was denied by the CBI claiming privilege. However it appears from the email of C Edmonds Allen dated 16th April 2012 that the aforementioned report was given to Abhishek Verma who was one of the accused. Copy of C Edmonds Allen email dated 16th April 2012 along with its attachments is enclosed as Annexure F (Colly) Thus, the involvement of Mr. Pranab Mukherjee in the Scorpene scam is apparent from the following facts:  He was the defense minister who signed the Scorpene submarine contract, and seems to have allowed Abhishek Verma to operate as a middleman in this deal even though the official policy of the government was to bar the middlemen in such contracts.  After the Navy war room leak was discovered, and the question arose about the action being taken against the civilians like Abhishek Verma, Ravi Shankaran and Kulbushan Parashar, who were involved in the leak Pranab Mukherjee sought to downplay by falsely stating that the leaked information was only of commercial nature.    He took not steps to prevent the civilians involved in the leak from leaving the country and they were allowed to leave the country He did not order any investigation in the Scorpene deal despite the Outlook magazine’s detailed expose on the issue. Under his watch, the CBI did a whitewashing preliminary enquiry, and claimed privilege over the preliminary enquiry report while secretly sharing it with the accused Abhishek Verma.

33  Despite Abhishek Verma’s partner Edmonds writing to the ED and the CBI agreeing to share a lot of incriminating evidence against Abhishek Verma and his role as a defense middleman, Mr. Pranab Mukherjee took no steps to have the matter investigated. The aforementioned facts prima facie constitute an offence under the Prevention of Corruption Act and therefore a thorough and fair investigation is required.

34 Mr. Sharad Pawar Accused of having close ties with some of the most dangerous criminals of the country: In 2002 and 2003, Mr. Sudhakar Rao— then minister in Maharashtra— alleged that Mr. Pawar asked him to be lenient against gangster Papu Kalani— a criminal turned politician. Mr. Rao also alleged that Mr. Kalani and Mr. Hitendra Thakur were given tickets at the behest of Mr. Pawar. Annexure A He was also accused of having relations with underworld don Dawood Ibrahim in the past and currently he is accused of having ties with 2G scam accused Shahid Balwa. Copy of the Indian Express report, Outlook report and excerpts of the book ‘Lucknow Boy’ written by Vinod Mehta is annexed as Annexure B (Colly) Abdul Karim Telgi—the prime accused in the Telgi scam— had admitted during the Narco-analysis test that the Rs 60,000 scam was a brain child of Mr. Pawar. Copies of the newspaper reports are annexed hereto as Annexure C (Colly). Wheat Import Scam: - Mr. Pawar is accused of having given permission to private and international companies to directly buy wheat from the farmers. This led to a complete sell out of the FCI stock, and there was nothing left to distribute through the ration shops. Therefore, the wheat for consumption of common people had to be imported. While the government had set a price of Rs 850 per ton for procuring from farmers; it went ahead and imported wheat at more than Rs 1400 per ton and mostly through select private companies. The government did not purchase wheat at higher prices from the farmers directly. A copy of the detailed not on this scam which had been issued in 2007 by Dr Kirit Somaiya who also sent a complaint to CVC on this is annexed as Annexure D. Ironically, wheat imported from these companies was rotten and not fit for human consumption. Copy of the lab reports of State Public Health Laboratory of May-Jun 2008 confirming the same are annexed as Annexure E. Politicians across all parties raised a hue and cry on the issue, but no investigation was initiated into the scam. Pulses Import Scam: The Government of India in order to bridge the gap between demand and production of pulses introduced two schemes for import and distribution of pulses in the year 2006 and 2008. This was to be done through four public agencies viz. NAFED, MMTC, PEC Ltd. and STC. The import would have also checked the rise in the price of pulses. However, it was found that this policy ended up benefitting four big private traders at the cost of the public trading companies. As much as 6.08 lakh MT of pulses were sold to these private companies. According to the CAG

35 report the public trading agencies incurred total loss of Rs 1201 Crore in importing pulses but domestic prices did not fall as supplies were not promptly made to the market. The CAG report further pointed out that the Ministry of Consumer Affairs Food and Public Distribution headed by Sharad Pawar failed to identify appropriate channels for the distribution of imported pulses. Instead of selling the imported pulses to people through the public distribution system, they were sold to private companies at a rate lower than the buying price and these companies in return sold the pulses at the higher market rates. Out of the total loss of Rs 1201 Crore, loss of Rs 897 Crore was incurred due to the import of Yellow Peas in 2007 as it was imported without much deliberation. The Government decided to import Yellow Peas on the ground that they were reasonably good substitute for other types of pulses and there prices were comparatively lower. However, the peas did not find many takers in the domestic market and were sold after considerable leading to aforementioned heavy losses to the importing agencies. Despite this, the agencies continued to import the peas during the subsequent years even when they had huge unsold stocks. Copies of the India Today report is annexed as Annexure F and relevant CAG report is enclosed herewith as Annexure G. LAVASA Scam Lavasa is a massive 25,000 acre hill station, valued at tens of thousands of Crore, is being developed in the eco sensitive areas of Western Ghats. The Ministry of Environment and Forests, New Delhi in its order 17th January, 2011 concluded as under: "The discussions and analysis clearly brings out the fact that M/s LCL is in violation of the (i) of the EIA Notification, 1994 (ii) EIA Notification, as amended in 2004; and (iii) the EIA Notification of 2006. The site visit Report has brought out the nature and magnitude of the environmental damage caused by the project. As such, the construction activity is unauthorized, being in violation of the above three Notifications and is also environmentally damaging." Copy of the Order dated 17th January, 2011 of the Ministry of Environment and Forests is annexed as Annexure H In this reference, among many other serious issues, the following points become apparent: 1. The initial directors of Lavasa Corporation, inter alia, were Supriya Sule, daughter of Sharad Pawar and her Husband Sadanand Sule having about 21 per cent shares. Supriya Sule has been Member of Parliament for two terms. There were certain other persons who are

36 known to be close to Sharad Pawar who too were Directors of the Company. This clearly shows the intimate connection of Sharad Pawar with Lavasa whose construction has been declared to be unauthorized by no less than a statutory entity. 2. Supriya Sule her husband sold their shares around the year 2006 on highly undervalued rates. This is apparent from the fact that the net worth of Sule as declared before the Election Commission did not undergo a major quantum of change between the year 2004 and 2009. For a massive company having enormous land assets, the worth of such shares were hundreds of Crores which were not reflected in the property declaration before the Election Commission. 3. When the illegal construction was going on, Sharad Pawar who had no statutory role to play in the construction since he was a Central Minister, held a meeting in Lavasa where many concessions were granted. When the project was unauthorized and which has been declared illegal through a statutory order, this interference of Sharad Pawar in the matter was highly disturbing. The minutes of the meeting held are enclosed as Annexure I 4. Precious land of the irrigation department was given to Lavasa at a pittance, without any auction, by the then Irrigation Minister and now Deputy Chief Minister Ajit Pawar, who is a nephew of Sharad Pawar and in blatant violation of the Maharashtra Land Revenue (Disposal of Government Land) Rules, 1971. Stern objections were raised by the conscientious Revenue Secretary Ramesh Kumar, on which no action was taken. The office note in this reference is being obtained. For the reason of this stand taken by whistle-blower Shri Ramesh Kumar, Government of Maharashtra has victimized Ramesh Kumar by refusing to go ahead in his appointment as Member Maharashtra Administrative Tribunal even though the statutory Selection Committee recommended his name. 5. It is also a known fact that Sharad Pawar personally took up the matter, with the Environment Minister Ms. Jyanti Natrajan on Lavasa, immediately after the uncompromising minister Jayram Ramesh left the government. Ms. Natrajan obliged Pawar and granted Environment Clearance under highly suspicious circumstances. Ms. Natrajan took the unprecedented act of granting Environment Clearance on a construction project where the Competent Authority for granting Environment Clearance on construction projects is the Maharashtra State Level Environment Impact Assessment Authority and not the Ministry of Environment and Forests, New Delhi. She also made the unprecedented order,

37 where she granted Environment Clearance without Lavasa following the due procedure of public hearing and when the Ministry of Environment and Forests, New Delhi order itself stated that the construction took place in violation of the Environment Impact Assessment of 1994, where there was no provision to grant Environment Clearance without public hearing. It was misuse of political power apparent allover 6. The Environment Department of Government of Maharashtra, under the control of Environment Secretary, Valsa Nair Singh, extended an enormous favour to Sharad Pawar by launching prosecution against the Lavasa Corporation and its current Directors only. Ms. Valsa spared Supriya Sule from prosecution even though when the violation took place around the year 2004, Ms. Sule was the Director of Lavasa. Incidentally, Ms. Valsa is also involved in the Adarsh scam and the CAG has blamed the conduct of Environment Department as 'wilful'. Ms. Valsa as the Chairperson of the Maharashtra Coastal Zone Management Authority, had got a show cause notice issued against Adarsh on a complaint made in August, 2008 and then she sat over the matter till the scam became open in late 2010. Notwithstanding the favour bestowed on Lavasa, Ms. Valsa has not only been spared from action in the Adarsh case, but has also been allowed to stay as Environment Secretary for more than 3 years when the law as contained in the Maharashtra Government Servants Regulation of Transfer and Prevention of Delay in Discharge of Official Duties Act, 2005, stipulates that an officer need to be transferred in 3 years. In this way, during the illegally extended tenure of Ms. Valsa, relatives of Sharad Pawar, were spared from prosecution by Ms. Valsa. 7. There are a host of other violations related to many other legislations and which all would not have happened but though the invisible hand of powerful people. The aforementioned facts prima facie constitute offences under Prevention of Corruption Act and therefore a thorough and fair investigation is required into Mr. Sharad Pawar’s role in: 1. Telgi Stamp Scam 2. Wheat Import Scam 3. Pulses Import Scam 4. LAVASA Scam

38 Mr. S M Krishna S.M. Krishna was the Chief Minister of Karnataka from 1999 to 2004. He has been serving as the Minister of External Affairs since 2009. The Government of Karnataka under Mr. Krishna in its orders dated 15.03.2003 de-reserved for private mining an area of 11,620 square kilometres in the State, meant for State exploitation/mining and notified the surrender of an area of 6,832.48 hectares of prime iron ore land respectively, which has paved way for distribution of public assets to select private entities. The entire exercise was undertaken in a matter so as to benefit only a select few entities. The Lokayukta of Karnataka in his report dated 18.12.2008, went into the depth of the entire issue and gave a detailed report on the said scandal. Relevant chapter of the said report is annexed as Annexure A. The said report stated: “The information wanted by the Cabinet Section was whether the statement in the Cabinet note that de-reservation is proposed in forest areas which have lost vegetative cover is factually correct. That information has not been furnished by the Forest department. Cabinet section did not pursue the matter. Without getting that information the subject was placed before the Cabinet and the proposal was approved by the Cabinet. The Cabinet has not been informed of all relevant and necessary facts. De-reservation order as such is not found in file but a notification dated 15-03-2003 informing the public that those lands are available for allotment to the public is found in the file. It is clear from the above that though the considered decision of the Government was not to de-reserve forest land and strategic mineral bearing areas like iron-ore, manganese, chromate and lime-stone, that aspect was not properly verified and reserve forests and State forests and strategic mineral bearing areas have been de-reserved.” On the basis of the facts stated in this report, a complaint was lodged against Mr. Krishna and others alleging that during his tenure as the Chief Minister of Karnataka, he had de-reserved thousands of acres of reserve forest land in Bellary and elsewhere and sanctioned it to private companies in the year 2003, despite contrary decisions of the then Minister for Forests and the then Secretary to the Government, Forest Department, who had expressed disagreement for de-reservation. These acts resulted in destruction of vast forest area and led to large scale illegal mine. SM Krishna clearly abused his position as the Chief Minister of Karnataka and illegally amassed wealth in the name of his family members, including children, in- laws and in the names of erstwhile very close fellow cabinet members. The de-reservation order which is stated to be the decision of

39 cabinet meeting held on 16.12.2003 has been destroyed. The notification dated 15.03.2003, notifying the public about availability of de-reserved forest lands to public was found in the file. It is alleged that even the notification is not in conformity with the Forest (Conservation) Rules, 2003 which under Rule 6 requires mandatory approval by the State Government. The malafide, illegal and anti state, corrupt intention of dereserving forest area vide notification dated 15.03.2003 is demonstrated by sudden spurt of issue of 82 permits in the year 2004 and 59 permits in the year 2006. The above acts were the beginning of destruction of reserved forest area and advent of illegal mining in the state of Karnataka, particularly, in the District of Bellary. On the said complaint, the Special Court, Bangalore vide order dated 03.12.2011 referred the matter to Lokayukta Police for investigation. The said order is annexed as Annexure B. He held: “In the overall circumstances of the case, after perusing the complaint, list of documents and the references made in the compliant with reference to documents, I consider that it is just and proper that a thorough and fair investigation by the Competent authority is necessary in the ends of justice, law and transparency.” It is to be noted that Mr. Krishna had neither been summoned nor arrested. Only an investigation had been ordered. But to prevent even that he approached the Karnataka High Court. On careful consideration of the report of the Lokayukta and the events preceding cabinet meeting held on 16.12.2002, consequent notification issued on 15.03.2003, the High Court of Karnataka in its order dated 20/01/2012 in Criminal Petition No. 6920/2011, which sought quashing of the complaint, opined that in the matter of de-reservation of an area of 11797 square kilometers, there has been contravention of relevant provisions of Forest (Conservation) Act, 1980 and Forest (Conservation) Rules, 2003. The High Court held: “We are but unable to appreciate that the Lokayukta report cannot be a basis for initiating any lawful action against those who are involved in unlawful acts in an illegal manner. One should not forget that the office of the Lokayukta is held by a former judge of the Apex Court. It is difficult to assume or presume that the said high authority would give a report without any material evidence whatsoever. Therefore we are unable to digest the contention that the Lokayukta report cannot be a basis for even to initiate an action against an illegal act.” The High Court accordingly upheld the order for investigation into the allegations. A copy of the order of the Hon’ble High Court is annexed as Annexure C.

40 Against the said detailed order of the High Court, Mr. Krishna approached the Supreme Court seeking an immediate stay of the investigation. Supreme Court has stayed the said investigation and the matter is pending. The order of the Supreme Court is annexed as Annexure D. The above shows the extent to which Mr. Krishna went to ensure that no investigation takes place on the issue of de-reservation of forest land, leading to a conclusion that he has a lot to hide. The facts as brought out by the Lokayukta report leave no room for doubt that a thorough investigation is necessary in the case.

41 Mr. Kamal Nath Rice Export Scam In October 2007, the central government had imposed a ban on export of any kind of rice except Basmati rice. This decision was taken so as to decrease the inflation in the country. There was an apprehension that the availability of rice will decrease in the ration shops. To prevent this scarcity the government took the decision of imposing the ban. Everybody appreciated this step taken by the government of India. India is a huge exporter of rice in the international market. As soon as India stopped the export of rice, the price of rice in the international market increased from $350 per ton to $1000 per ton. During this time it has come to light that a few selected private companies were allowed to circumvent this ban and make huge killing of around Rs 2500 crore. Mr Kamal Nath, who was the commerce minister at that time, figures prominently in the scam. Within three months of imposing the ban on the export of rice, in Jan 2008, the central government stated that the ban imposed on export of rice had led to scarcity in many poor countries and hence on the basis of humanitarian grounds, India should export the rice to those poor countries at subsidized prices. As soon as the news came out, 21 African countries sent letters to the foreign ministry desiring to purchase rice from India. The Governments of Sierra Leone and Ghana wrote to our ministry that rice should be made available to them at low cost. Usually, such trades happen between two governments. However, in this matter these foreign governments mentioned some private companies in India and asked Indian government to export rice through these companies only instead of sending rice directly to their country. Usually, in such matters government’s companies like STC, MMTC, PEC Ltd. etc export the material from the Indian government, but in this case rules were kept aside and the Indian Government gave the permission to buy and export the rice to these private companies. Indian Government didn’t even have the control on what price those companies bought the rice from India and at what price it was sold to those countries. Not just this, the Indian Government didn’t even care to check whether the rice, after going out of India, reached those countries or ended up in the open market. It came to light that the companies sold the rice to those countries on International rates. If those countries wanted to buy the rice on international rates only, then what was the need for them to buy it from India only? They could have bought rice from the international market. In this import and export matter neither there was a profit to India nor to the people of those countries.

42 Here the profit was only for those companies who bought rice on a very cheap rate and sold them at the international rate. It seems quite evident that all those ministers who gave the permission to these companies to do so also profited. In one case, a Letter of Credit (LOC) came from a company in Switzerland rather than from these countries. All this came to light when the government in Ghana changed. When the new Government started the investigations of the corruption done by the old government they came to know that ex- foreign ministers along with few ministers of our government had done a huge scam on the name of import-export. The Government of Ghana on 13 Aug, 2009 sent a seven page letter, in which they demanded that there should be an investigation on the then Foreign minister Mr. Pranab Mukherjee and the then Commerce minister Mr. Kamal Nath, in relation to this matter. Stories published in Outlook dated 27 July 2009 and 17th Aug 2009 along as Annexure A (Colly). Copy of the letter from Govt. of Sierra Leone dated 31st March 2009 and copy of the letter from Govt. of Ghana dated 13th Aug 2009 is enclosed herewith as Annexure B (Colly) Niira Radia tapes: In Niira Radia tape, Mrs Radia is talking to the ex-chief of CII, Mr. Tarun Das. Mr Das tells her that in his new ministry Mr Nath can make his 15% as well as serve the nation. This conveys that Mr Nath as a commerce minister has an image of an agent who works on 15% commission. Copy of the excerpts along with the CD from Niira Radia tape is annexed hereto as Annexure C (Colly). Protecting Corrupt official: When Mr. Nath was Transport Minister, CBI had asked his permission to investigate against Mr S I Patel, who was a member of National Highway Authority of India (NHAI). A scam of Rs 10,800 crores about the contract of NH-69 came out at that time. This contract was given to a company OSEPL of Delhi. CBI arrested many officers of OSEPL and NH-69 during various raids and charged them with corruption over the allotment of this contract. During these raids the CBI got Rs 1.86 crore cash as unaccounted money. Even after these strong evidences Mr. Nath didn’t give permission to investigate against the said officer. He even increased Mr Patel’s holidays till he got bail from the court. It got worse when even after this NHAI maintained the contract with the alleged company OSEPL. The aforesaid fact clearly suggests that Sh. Kamal Nath is also involved in the aforesaid scam and therefore, he was blatantly trying to protect one of the accused. Copies of the reports published in Indian Express and Outlook are enclosed herewith as Annexure D (Colly).

43 The aforementioned facts prima facie constitute offences under Prevention of Corruption Act and therefore a thorough and fair investigation is required into Mr. Kamal Nath’s role in: 1. Rice export scam 2. NH-69 scam

44 Mr. Praful Patel Mr. Patel, as minister of civil aviation, through his deliberate and mala fide decisions and actions made the Air India and Indian Airlines suffer heavy losses to the tune of thousands of crores. He drove the airlines for a huge fleet expansion program in which purchase orders for 111 aircrafts were given. This unnecessary expansion was made without any proper study and without any transparency. The purchase orders of the aircrafts were given costing a whopping Rs. 67,000 crores. Loans were taken from US and Indian banks to finance the same and today the airlines are deep in debt and suffering huge losses. And also when aircrafts were being purchased, more and more aircrafts were taken on lease thus forcing additional loss and making the need for purchase redundant. Apart from this, through deliberate and mala fide decisions, the major profit making routes and timings were given to one or two private airlines causing a huge loss of market share to the national carriers. Foreign airlines were given unrestricted entry into India and major routes were given to them without taking any reciprocal benefits for Air India. Despite warning that these actions would result in heavy loss of market share to our national carrier, the civil aviation ministry continued with its unprecedented reckless actions. This was done when the ministry had forced Air India to purchase a large number of planes. The Parliamentary Standing Committee on Transport, Tourism and Culture has severely criticized the government on its aircraft acquisition program. Copy of the said report is annexed as Annexure A. The said committee comprising of 10 Rajya Sabha Members and 21 Lok Sabha Members cutting across party-lines in a detailed and unanimous report dated 21.01.2010 had made the following observations: “Aircraft Acquisition Programmes of the erstwhile Air India and Indian Airlines were finalized in haste.” “The entire aircraft acquisition programme lacked required transparency.” “Reasons for going ahead with huge purchases by the Ministry of Civil Aviation despite Air India and Indian Airlines not having the capacity to support it, remains unknown to the Committee.” “It, therefore, recommends that this aspect needs to be further probed to fix responsibility for taking such an ambitious decision that has become big financial liability.”

45 Apart from the purchase of aircrafts, a large number of aircrafts were taken on lease by Air India simultaneously. It adopted standard lease agreement drafts for taking acquiring aircraft on lease which did not have an early termination clause. In view of very low load because of large scale aircraft acquisition, several flights, especially overseas flights, were running almost empty and at huge loss. Air India could not even terminate the lease agreements since in that case it would have to pay all costs and lease rental differentials. The Parliamentary Committee on Transport in its analysis concluded: “A decision to go for…lease of aircrafts was taken to increase market share without due considerations regarding proper route study and marketing or pricing strategy. The Committee observes that aircrafts were dry/wet leased even while aircrafts acquisition programme was going on. The Committee feels that aggressiveness shown in leasing of aircrafts has now turned out to be an unviable proposition. It raises genuine doubts about the Government’s approach towards the entire issue. The Committee is of the opinion that it has led NACIL into a morass from which it is very difficult to come out. The Committee could not comprehend why the NACIL

Management and the Ministry of Civil Aviation went ahead after 2005 with the expensive proposition of leasing of aircrafts that too without any exit clause. The Committee also notes that even after the new aircraft delivery to NACIL, the company continued to lease aircraft or renewed the leases on some pretext or the other, which caused huge loss to the company at the time of recession, low seat factor and capacity underutilization. All such decisions taken by the Management and the Ministry of Civil Aviation had ultimately resulted in big financial loss to the company. The Committee recommends that all the lease agreements maybe reviewed and appropriate action may be taken in cases where agreements were not based on sound business prudence.”

46 On the directions of the Civil Aviation Ministry, Air India withdrew its services from many profit-making routes. Private operators were the biggest beneficiaries of this decision as they took all those routes and a bigger market share. Air India, which also has a social responsibility to ply at even non-viable and non-profit making routes, was the biggest loser as it lost all its profit making routes to private airlines. Air India also gave away its routes to private and foreign operators without taking any reciprocal benefits. The Parliamentary Committee on Transport had noted and recommended: “Air India started to withdraw their services from the lucrative and profit earning routes in the name of route rationalization and simultaneously opened door for private operators. Private operators were favoured in the route dispersal

guidelines and more and more bilaterals were handed over to the private airlines on a platter. The Committee therefore recommends that the decision to open the highly lucrative international air markets to/from India may be probed by a suitable agency and all those bilaterals must be reconsidered and reviewed and responsibility may be fixed for giving away the national rights. The Committee strongly recommends that an inquiry maybe conducted to find out why such a large number of bilateral were granted to foreign players. Committee notes that services are being withdrawn from lucrative sectors by NACIL paving the way for introduction of services by the private operators in the same sector. The Committee fails to understand the logic behind this move and feels that this move will definitely fill the coffers of private operators. Committee apprehends that there appears to be a nexus operating…to favour the private operators.” Now, the CAG has given its report on aircraft acquisition and the role of the ministry. The said report read together with the facts and documents which are on record in the instant case, conclusively show how the ministry pushed the airlines into a mammoth purchase that was a recipe

47 for disaster. CAG has also noted how the terms were changed to the direct benefit of M/s Boeing. Copy of the summary of the CAG report is annexed as Annexure B. The major findings of the CAG are: a) Air India’s project report of January 2004 proposed acquisition of 28 aircraft. However, by November 2004, Air India changed their fleet acquisition plan and submitted a revised proposal for acquisition of 68 aircraft. The sequence of events upto November 2004 clearly demonstrates that the Air India hastily reworked its earlier acquisition plan and expanded its requirement. This increase in numbers does not withstand audit scrutiny considering the market requirements obtaining then or forecast for the future as also the commercial viability projected to justify the acquisition. The acquisition appears to be supply-driven. (Para and b) A programme which was under consideration from 1996 and took 8 years to progress upto Government level for purchase of 28 aircrafts suddenly picked up speed after August 2004 and by December 2005 Government signed contract with Boeing for 68 aircrafts. (Para 3.1.7) c) Many of the key assumptions underlying the revised project were flawed. (Para d) No benchmarks for the cost of the aircraft were set before negotiations were initiated with the manufacturers. (Para 3.1.7) e) The entire acquisition was to be funded through debt. This was a recipe for disaster ab initio. (Para 3.4) According to the CAG, the fleet expansion programme “does not withstand audit scrutiny.” CAG further says that it “was a recipe for diaster ab initio and should have raised alarm signals” in the Government. Air India, the erstwhile Air India prior to merger, had a turnover of between Rs 75008000 crore in the three years preceding the placement of aircraft order in 2005. Air India's profit, if it made, ranged from Rs 90-133 crores in the preceding five years. Air India's cumulative profit in the 10 years preceding the placement of order was around Rs 750 crore. CAG report states that the repayment of debt taken for aircraft acquisition will be financed through revenue generated by Air India. Considering that the cost of 68 aircraft ordered from Boeing was around Rs 35000 crore, and the repayment of loan was to be done through internal accrual, meant that Air India must make a profit of at least Rs 2500 per annum, even if interest liability is taken as zero for the sake of argument. In the aviation industry

48 no airline worldwide, including Singapore Airlines, British Airways, makes a profit of more that 3-4 percent of it's total revenue. If Air India was to make a profit of Rs 2500 crore it was therefore expected to have a revenue of approximately Rs 60000 crore - meaning a stupendous jump from a paltry Rs 7500 - 8000 crore. Air India's revenue has since the induction of aircraft began in 2007 fallen from approximately Rs 17000 crore (combined revenue post merger) to Rs 12500 crore in the financial year ending March 2011. These facts clearly show that aircraft acquisition proposal was ill conceived and a recipe for disaster, as the CAG has found in its report. The above averments have found some corroboration in some of the intercepted conversations of Ms. Niira Radia tapes which are now in public domain. Transcripts of the said conversations are annexed as Annexure C. Under the Prevention of Corruption Act 1988, a public servant is guilty of criminal misconduct under Section 13 of the Act if he abuses his authority to give any pecuniary benefit to any person, or if uses his position to give pecuniary benefit to person without any public interest. This crime has already been committed for which Mr. Patel needs to be proceeded against. Also, since these aircrafts purchase deals are known to involve huge kickbacks, the offences of bribery also need to be investigated.

49 Mr Vilasrao Deshmukh Adarsh Society Scam: Mr. Deshmukh with the help of the then Urban Development Department Secretary Shri Tiwari, got the width of the road deleted from 60 to 18 m with the malafide purpose of creating a plot of land for Adarsh Cooperative Housing Society. Thus, by this mechanism of reducing width, a plot for Adarsh was created from this 42 m wide land released from road reservation. Needless to add that road width cannot be reduced to accommodate the land requirements of a private society mainly of politicians and their benami nominees and is a blatant violation of section 22 of the Maharashtra Regional and Town Planning Act, 1966. After Shri Deshmukh got the road width reduced, he gave instructions to the Revenue Department to put up the proposal for allotment of land to Adarsh Co-operative Housing Society claiming to give flat to Kargil War Widows. The basic allotment of land was done to Adarsh through a Letter of Intent. Under highly suspicious circumstances, this file related to the issuance of the Letter of Intent was kept with the then Chief Minister Shri Vilasrao Deshmukh for about 5 months, during which time the manipulation in names was taking place. This file was cleared by Mr. Deshmukh for the issuance of LOI on the last day of his post as Chief Minister i.e. on 16 January, 2003. A manipulation of noting was done. The file was shown to have been received from the Office of Chief Minister on 16th January, 2003 and then critical elements of noting were erased. This file was again shown to have been received back from the office of Chief Minister on 18th January 2003. As per the High Court ruling and also Coastal Regulation Zone Notification, 1991 alteration of Development Plan in Coastal Regulation Zone Notification, 1991 areas have to be done only by permission of the Maharashtra Coastal Zone Management Authority – no such reference was made before the width of the road was reduced to accommodate Adarsh and for altering the Development Plan in this reference. The proposal for allotment of land to Adarsh was put up on specific orders of the then Chief Minister Vilasrao Deshmukh after hectic lobbying was done by Kanhaiyalal Gidwani. Under highly suspicious circumstances, Gidwani had a series of personal meetings with Vilasrao Deshmukh.

50 Notwithstanding sceptical, unclear and hazy recommendations of the Finance Department, Shri D.K. Shankaran, IAS, then Revenue Secretary recommended the case for LOI and then his son was made a Member of Society and Shri Deshmukh raised no objection. As per law, there has to be a clear-cut positive recommendation of the Finance Department which was not done in this case. Even though the file purported to clearly specify the list of names, yet no specific list was finalised when Mr. Deshmukh issued orders for the issuance of LOI and that such names were not shown on the notesheet. This list was added prepared and shown to be added with the LOI. This also seems to be a case of manipulation of documents. During his second tenure as Chief Minister, Shri Deshmukh issued orders for deletion of BEST (Brihan Mumbai Electric Supply and Transport Undertaking) depot reservation on the grounds that the BEST Undertaking did not need the plot even though they needed the plot. Actually, the BEST had issued no such letter clearly stating that they did not need the land. In this way, the provisions of section 50 of the Maharashtra Regional and Town Planning Act, 1966, to release reservation when plot is not required by the authority in whose favour reservation was made, this law was fraudulently used. It was required for Shri Deshmukh to have taken permission of the Maharashtra Coastal Zone Management Authority before the BEST reservation was deleted. However, he did not take any such permission. More specifically, the Finance Department had agreed only to an in principle approval for giving BEST FSI on the condition that the Environment Clearance shall be obtained from the Ministry of Environment and Forests, New Delhi. This condition was flouted. Copy of the CAG report on Adarsh Scam is enclosed as Annexure A Allotting Land to Film-maker Subhash Ghai Illegally: Mr. Deshmukh allotted 20 acres of land to film-maker Subash Ghai for the latter’s film institute for a price of Rs 3 crore. The CAG in its report notes that the actual cost of the land is Rs 31.2 crore and the deal resulted in a loss of over Rs 28 crore to the public exchequer. Recently the Bombay High Court and the Supreme Court have termed the allotment as illegal and cancelled it. The Bombay High Court noted that the allotment was ‘illegal’ and Mr. Deshmukh had misused his official position. It has taken strong exception to the ex-chief minister’s misuse of his position and power. Despite such strong observations by the court Mr. Deskmukh continues to be a cabinet minister in the central government. Even the appeal against

51 the order of the High Court has been dismissed by the Supreme Court. Copies of the order of the High Court dated 9th Feb 2012 and Supreme Court dated 4th April 2012 are enclosed as Annexure B (Colly) The issue of protecting money-lender father of a legislator in Vidharba: Mr. Sarangdhar Singh Chavan and his brother Mr. Vijay Singh Chavan had borrowed money from money lender Gokulchand Sananda who is the father of Congress MLA Mr. Dilip Kumar Sananda. Since Gokulchand was charging them interest at the rate of 10 per cent per month, it became difficult to repay the money and Gokulcand seized their land and continued to harass him. Mr. Chavan went ahead and lodged a police complaint against Gokulchand, but his son Dilip met with Mr. Deshmukh and ensured that no action was taken by the police against his father. Vilasrao Deshmukh summoned the collector at Buldhana and instructed him not to take action against the Sananda family and this even finds mention in the police register. That left Chavan brothers with no option but to move court. The case was first registered in the Bombay High Court and later moved to the Supreme Court which while passing an order noted that due to this case ‘the soul of the court has been shaken’. It further said that the case was about benefiting only a small number of people by exploiting the interest of poor farmers. “Those poor farmers who have taken loan from moneylenders and have approached the governmental officials in order to seek legal redress against the exploitation by these moneylenders had no hope left,” the apex court had noted. The Supreme Court further upheld that the decisions of Mr. Deshmukh were unconstitutional and were very much against the aspects of equality and social values framed in the Indian constitution. With this the court imposed a penalty of Rs. 10 lakh on the State Government. Copy of the Supreme Court judgment dated 14th Dec 2010 is enclosed as Annexure C Despite such critical statements made by the highest court of the nation, Mr. Deshmukh is still holding a post in the cabinet. Accused of giving 2 lakh sq.metre plots to his family trust at a cheap rates: Mr. Deshmukh’s family is running a trust named, “Vilasrao Deshmukh Foundation” and according to a CAG report, this trust was allotted 2 lakh sq.metre land in Latur district at throw away prices by Maharashtra Industrial Development Corporation for establishment educational institution. The land was allotted even when there was nothing on record to indicate that the institution fulfils the eligibility criteria as laid down by MIDC in its policy of allotment of plots to the educational institutions.

52 Further, the area allotted to the trust was in excess of the area specified in the policy. Not just that, the additional area was not allotted at the prevailing rates for industrial plots as specified in the policy. As per the CAG report this resulted in a loss of Rs. 1.119 Crore to the corporation. Copy of the relevant page of Chapter 4 of the CAG report of Jan 2008 is enclosed as Annexure D. It appears that a PIL challenging the allotment of land has been filed in Bombay High Court. The aforementioned facts prima facie constitute offences under Prevention of Corruption Act and therefore a thorough and fair investigation is required into Mr. Vilasrao Deshmukh’s role in: 1. Adarsh Scam 2. Illegally protecting money lender’s father in Vidharba 3. Illegal allotment of land to the institution of Subhash Ghai 4. Allotment of 2 lakh square meter land to his family trust at throwaway prices

53 Mr. Virbhadra Singh Mr. Virbhadra Singh was the chief minister of Himachal Pradesh from 1983 to 1990, 1993 to 1998 and 2003 to 2007. During these tenures he faced many allegations of corruption: Illegal recruitments/postings of government officials through ‘chits’: It is alleged that when he was the chief minister from 1993 to 1998, official recruitments and postings in his government were done illegally through the ‘chit system’. In 1998 two committees, including renowned IAS officers Mr. Harsh Gupta and Mr. Avay Shukla, were formed to probe the allegation. In its report, submitted in 1999, the committee upheld the allegations against Mr. Singh and his ministers. The report in its findings mentions that a number of U.O. notes were issued to various departments by the then CM (Virbhadra Singh) Office /minister during the period. It also mentions that many recommendations were made to the recruiting/appointing authorities through telephone calls and word of mouth etc. Despite the Harsh Gupta Committee having clearly indicted Mr Singh and some of his ministers, no action was taken against him. The High Court of Himachal Pradesh in a PIL in 2005 had directed the Vigilance Department to register a case and probe the persons who had been instrumental in making these appointments. Pursuant to the High Court order, an FIR was registered but it appears that no credible investigation was carried out and no action was taken against Mr. Singh. Copies of the reports of the two committees report along with the Hindustan Times report dated 7th Nov 2005 are enclosed as Annexure A (Colly). Copy of the Himachal Pradesh High Court order dated 7th Nov 2005 and FIR dated 5th January 2006 is annexed as Annexure B (Colly). CD Scam: An audio recording of Mr Singh and his wife in discussion with former IAS officer Mr. Mahendra indicates their involvement in illegal money transactions. Although Mr Singh claimed that the CD was fabricated to frame him, it appears that the CFSL lab in Chandigarh have confirmed the voices belonged to him and his wife Mrs. Pratibha Singh (former Member of Parliament). They were chargesheeted with corruption by the state Vigilance department vide article 13(1) (d) and 13(2) of the anti corruption law and on 3 August, 2009, FIR No. 27/9 was filed. Mr. Singh appealed to the High Court seeking the dismissal of the FIR against him, but on September 3, 2010, the high court dismissed his appeal. The matter is pending in the court for framing charges against him where he Mr. Virbhadra Singh has been seeking repeated adjournments. Interestingly Mr. Singh also pleaded with the court to transfer his case to CBI. As he is a minister in central government and CBI comes directly

54 under the control of central government, this could have only helped him. But that wasn’t to be as the high court dismissed his appeal seeking the transfer of the case to CBI. (Colly) It is unfortunate that Mr. Virbhadra Singh who has been chargesheeted in a corruption scam continues to be in the Union cabinet. However the appointment and recruitment scam of 1993-1998 in which he is supposed to have been the kingpin needs a thorough and independent investigation by credible agency. Copies of some of the newspaper reports regarding the CD Case as well as copy of CD are annexed as Annexure C

55 Mr. Kapil Sibal RCL and RTL have been providing telecom services across the country under Universal Access Service (UAS) licenses granted to them by the DoT. While continuing with these UAS licenses, the DoT’s another arm Universal Service Obligation (USO) Fund Administrator – executed another agreement with RCL & RTL for providing telecom services in the rural & remote areas where the fixed/wireless telephone services had not reached. Both, UASL and USOF agreements had different level of penalties for delays in the rollout. However, only UASL had prescribed Rs 50 crore (per Service Area) penalty for serious violations of the license agreements. This penalty of Rs 50 crore was also applicable to services provided under USOF agreement since the termination/suspension of services was prohibited. In this regard, the relevant clauses of these license/agreements are reproduced herein below: Clause 8.1 Section-VI (Operating Conditions) of USOF Agreement “The terms and conditions as to prohibition of certain activities of the BSO or CMTS or UASL agreement, as the case may be, shall be binding mutatis mutandis.” Clause 12.3 Section-III (General Conditions) of USOF Agreement Notwithstanding any dispute or claim of the pendency of any arbitration or other proceedings, the USP shall continue to provide the service for the whole duration of the Agreement. Clause of 30.3 of the UAS license “The Licensee shall ensure continuity of services to its customers unless License is Terminated or Suspended by the Licensor for any reason whatsoever.” Clause 10.2 (i) of UAS license “The Licensor may, without prejudice to any other remedy available for the breach of any conditions of License, by a written notice of 60 Calendar days from the date of issue of such notice to the Licensee at its registered office, terminate this License under any of the following circumstances: If the licensee: a) fails to perform any obligation(s) under the License including timely payments of fee and other charges due to the Licensor;


Clause 10.2 (ii) of UAS license (Part-I General Conditions) “The Licensor may also impose a financial penalty not exceeding Rs 50 crores for violation of terms and conditions of licence agreement. This penalty is exclusive of Liquidated Damages as prescribed under clause 35 of this Licence Agreement.” Hence, it is clear that violation (especially deliberate and unilateral serious violations) of the license agreement by a licensee gives a right to the government to either cancel the license or impose penalty of Rs 50 crores per circle or both. Only in case where the government moves to cancel the license, a notice of 60 days has to be given. Since RCL & RTL discontinued (switched off / closed) the service at various places in rural India unilaterally, without notice to either the Government or to the subscribers, it was a serious violation. These places were spread across 13 telecom circles across India, hence Reliance had violated its 13 license agreements (since there is a separate license agreement for each circle), and all its 13 licenses were liable for termination and a maximum penalty of Rs 650 crores could and should have been imposed. However, Mr Sibal, for unknown reason, saved RCL & RTL from this penalty as detailed in the subsequent paragraphs. On December 7, 2010, Reliance wrote a letter stating that it had switched off its services effective from November 22, 2010. Hence Reliance had simply shut down its services unilaterally and without any notice. This is a serious violation of license agreement. The USOF cell of the DoT had proposed a penalty against RCL & RTL for “violation of the terms and conditions of Universal Service Obligation Fund (USOF) agreement and UASL agreement by voluntary, unilateral and unauthorized switching-off / closure of services to subscribers from USOF sites without any notice.” A show-cause notice of 15 days was issued to Reliance which stated that Reliance was in clear violation of the UASL agreement. USOF cell issued a notice for a penalty of only Rs 50 crore. A copy of the show-cause notice along is annexed as Annexure A. Reliance neither restored the service nor did it reply to the show-cause notice. It vide its letter dated January 5, 2011 asked for 6 weeks more time to reply. USOF Administrator replied that Reliance’s request for more time could only be considered if it first restored the services. Reliance again wrote a letter on January 11, 2011 requesting for 6 weeks more time to reply to show-cause notice. It however did not make its intention known

57 whether it intends to restore services or not. On January 12, 2011 USOF administrator again asked Reliance to make its stand clear on restoration. Reliance wrote back that it was still internally discussing the issue and reiterated its demand for more time. Under these circumstances, Director of USOF cell wrote a detailed note recommending a penalty on Reliance of Rs 50 crores in terms of the showcause notice that Reliance did not reply. This note was sent to the Licensing Cell of DoT which approved the penalty. A copy of the relevant pages of this file is annexed as Annexure B. Then this file moved up and was approved by all including Advisor Finance and Member Finance on February 8, 2011. On February 9, 2011, Telecom Secretary who is also the Chairman of Telecom Commission, approved the levy of the said penalty of Rs 50 crore. A copy of the relevant page of DoT file is annexed as Annexure C. The file reached the office of the Telecom Minister Mr Sibal on the same day i.e. on February 9, 2011. Thereafter, on 16.02.2011, Reliance wrote a letter to Mr Sibal that it had restored the services. Based on this letter, Mr Sibal on February 18, 2011 treated this serious violation by Reliance as a mere “interruption” of services. While rejecting DoT’s stand of levying Rs 50 crore penalty Mr Sibal had stated that UASL agreement clauses should not be invoked and penalty under USOF agreement for “interruption” should be imposed. Mr. Sibal did not even verify whether services had indeed been restored. This, in effect, reduced the penalty to a meager amount. A copy of the note of Mr Sibal is annexed as Annexure D. “Interruption” means a technical fault or other circumstances beyond the control of the telecom operator that results in disruption of service. However, here was a case of voluntary, unilateral and unauthorised closure or shutting down of service permanently. Under the threat of penalty, Reliance, as per Mr Sibal’s note, restored the service on February 16, 2011. The restarting of service by Reliance after three months of shutting it down cannot be termed as a mitigating circumstances. This would set a dangerous precedent, as then any operator can simply unilaterally discontinue the service subsequently under threat of penalty. Moreover, the action of Mr Sibal in reducing the penalty overruling the unanimous view of the USOF branch and the entire telecom department, including the Secretary who is the Chairperson of the Telecom without notice and restore it

58 Commission, is arbitrary & illegal, both procedurally as well as on merits. Why did Mr Sibal not insist on a proper reply to the show-cause notice first? Why did he call it “interruption” when it was a clear case of closure/discontinuation of service? Why did he not wait for a proper verification as to whether Reliance had indeed restored service in all the clusters where it had switched off? Why did he state that UAS License agreement is not applicable and department must only proceed under USOFA? Why did he not send the matter back to the USOF cell and to the Department after receipt of the letter of Reliance? If there was a legal issue involved, why did he not refer the matter to the Law Ministry? Why did he not take the advice of telecom regulator Trai which is a statutory body to protect the interests of consumers? Why did Mr Sibal not impose the penalty of Rs 50 crores per circle and let Reliance challenge it in TDSAT if it felt aggrieved? In view of the above, it is clear that Mr Sibal acted in a way that protected the interest of a corporation that had committed serious violation of the license agreement. Mr Sibal ignored the fact that his duty is to promote public welfare and safeguard the interests of consumers who in this case were poor people in the rural and remote parts of India, who could not have even approached courts against Reliance. Abusing one’s official position to benefit a private party at the cost of exchequer is an offence under the Prevention of Corruption Act. The above facts highlight the need for a thorough investigation.

59 Mr. Salman Khurshid Mr. Salman Khurshid has openly attempted to shield Reliance-Swan and Essar-Loop in the 2G scam by abusing his official position as Corporate Affairs Minister and as Law Minister to interfere in the 2G investigations. According to the law a company cannot be given two licenses. Essar, a telecom company operating in alliance with Vodafone, had already acquired one telecom license, but it is alleged that the group opened a new proxy company named ‘Loop’ and acquired another license. CBI, Enforcement Directorate, Company Affairs and even the RBI stated that ‘Loop’ was a fraud company of Essar, but throwing the findings in wind Mr. Salman, despite being the Law Minister, claimed twice in writing and once while speaking to the media that ‘Loop’ was not a proxy company of Essar group. Now CBI chargesheet has confirmed the fact that Loop was nothing but a front company for Essar, as the entire decision making and funding of Loop came from Essar. This brazen support was not only limited to Essar. When Mr. Salman, was the Minister of Company Affairs, he openly supported Reliance Telecom owned by Mr. Anil Ambani. Reliance had acquired a telecom license, but it floated a proxy company naming it ‘Swan’ through which it acquired another license. Yet again Mr. Salman claimed that ‘Swan’ was not a company of Reliance. Pertinently, the CBI which is investigating the 2G scam has in the chargesheet stated that ‘Swan’ is owned by Reliance. It is important to mention that the CBI had not asked Mr. Salman about his opinion on the matter and it was the Essar group which had sought his opinion. And Mr. Salman gave his opinion to mislead the CBI. This happened despite the fact that the Supreme Court had warned that no person should try to influence the CBI investigations. (Annexure A) On April 13, 2009, the Ministry of Company Affairs (MCA), when Mr. Murali Deora was its minister, had submitted a report to the DoT indicating that Loop Telecom is controlled by Essar group. The relevant part of this letter dated April 13, 2009 (Annexure-B) is reproduced below: Ministry of Corporate Affair’s letter dated April 13, 2009 to DoT (a) The Company, Loop Telecom is owned, in turn, by another company Santa Trading Pvt Ltd (STPL), which also owns BPL Communication and BPL Mobile Communications. (b) The Essar Group does not have any direct equity in STPL Loop Telecom. It, however, holds 9.99% in Loop Telecom, indirectly.

60 (c) Essar Group, however, has invested into unsecured, non-

convertible debentures of STPL, to the extent of Rs 1,592 cr which is otherwise a small company having a paid up capital of Rs 1 lakh only. STPL, in turn, has utilized these funds to invest in BPL Communication in the form of equity share and unsecured debentures. BPL Communication, in turn, has invested in multi-operational convertible debentures issued by Essar Investment Ltd. As a result of this chain of investments, STPL has receivable due through BPL Communication, to the tune of Rs 2,421 cr from Essar Investment Ltd, against an investment of Rs 1,592 Cr. (d) From the above, it appears that funds from the Essar Group have been routed through STPL and BPL Communications back to Essar Investments, in the process providing about Rs 800 cr of dues to STPL. Therefore, there are significant links and benefits arising to the STPL from the financial transactions, direct and indirect with the Essar Group. STPL has operations/transactions which are substantially controlled or influenced by Essar Group. (e) The company, Loop Telecom, apparently a recipient of a LOI/license for telecommunications has received some indirect equity support from STPL via BPL Mobile Communications (9.9%), but this is not sufficient to demonstrate control through equity. (f) From the shareholding pattern of related companies, it is seen that STPL holds 85.75% of BPL Communications, which in turn holds 78.99% of BPL Mobile Communications, which in turn holds 51.24% of Loop Telecom. The investment made by the Essar Group and other in STPL through non-convertible debentures has gone to BPL Communications in the form of equity (Rs 1,006 cr), preference share (Rs 175.8 cr) and NCDs (Rs 410 cr) totaling Rs 1,592 cr. Therefore, STPL appears to have been a conduit for investment of these funds in BPL Communications which is one of the main shareholders (48.76%) in Loop Telecom, with BPL Mobile Communications holding 51.2%. Significantly, BPL Communications holds 73.99% in BPL Mobile Communications. (g) Therefore, while Essar Group is not an equity holder in STPL, it has invested a huge amount in its NCDs and it would appear that through the funding of STPL by the Essar Group,

61 equity has been provided to BPL Communications who is a 48% owner of Loop Telecom, though not directly to Loop Telecom. (h) In the light of above, Department of Telecommunications, may examine their policy and regulations for eligibility for grant of Letter of Intent (LOI) to Loop Telecom Pvt Ltd for grant of UAS licenses. Taking note of the above letter of the MCA, the DoT had on September 18, 2009 (Annexure-C) proposed to issue a show-cause notice (SCN) to Essar/Loop. The relevant part of this DoT’ note is reproduced below: Extract of DoT’s note dated September 18, 2009 (6) Financial sense is corroborated by the findings of the MCA that there is significant financial control of Essar group over STPL that in turn owns 76.7% of equity of Loop Telecom. Thus Essar group has significant control over Loop Telecom. (7) The main objective of putting the clause quoted in para 3 above is to ensure that one entity does not control two UAS Licensees in the same service area. It is therefore suggested that the issue of control through exaggerated debt funding by Essar group be made a part of the proposed show cause notice to M/s Loop Telecom Pvt Ltd. However, no show cause notice has been issued by the DoT to the company in this regard even though the DoT officers had attempted a draft SCN way back in March 2011 (Annexure-D). While the matter was still being investigated by the CBI, the DoT, under Mr Kapil Sibal as its Minister, obtained an opinion from the Law Ministry dated August 30, 2011 (Annexure-E) on the definition of “Associate”. The Minister of Law & Justice, Mr. Khurshid, approved this note that bails out Essar/Loop and also Swan/Reliance. This note gives cross-references of various provisions around the word “associate” in a manner that rules out any violation by Loop/Essar. Another important observation has been made at para No. 4 of this note that the above clause No. 8 on crossholding is to be complied with only after the licenses have been issued, and not from the date of application. This also is not correct. The guidelines on UAS license reproduced above clearly stipulate that a certificate in the specified format, issued by the Company Secretary on cross-holding, must be submitted alongwith application for UAS license.

62 And the definition given to by the Law Ministry to the term “associate” would completely defeat the object and purpose of clause 8 of UASL guidelines which mandates that single group should not have control over 2 licensee companies. The DoT sent this letter to the CBI on September 7, 2011 with the approval of its Minister of Communications & IT Mr Kapil Sibal. This letter has been used by the 2G scam accused Mr Shahid Balwa to defend his case in the matter of Swan Telecom/Etisalat DB. This company too is accused of violating cross-holding norms, similar to Loop/Essar matter. The CBI termed this advice as unsolicited. (Annexure-F) In a report of last year (Annexure-G), the Enforcement Directorate and Reserve Bank of India had observed that Loop is owned and controlled by Essar. Despite this, Mr Khurshid has gone ahead with his opinion in the matter contradicting the findings of the other departments including the CBI. Interference in the investigation by the Union Ministers especially Mr Salman Khurshid is apparent. Mr Khurshid has publicly given clean chit to Essar/Loop. In this regard, various news clippings are filed herein and marked as Annexure-H. The Attorney General, whose opinion was sought by CBI, in his opinion had listed out as many as 22 solid facts/instances as unearthed in CBI investigation that made a clear cut case of cheating. (Annexure I) But this did not stop Mr. Khurshid to again give a clean chit to Essar/Loop in November 2011 by giving a detail note in favour of the company on the official Law Ministry file. This came in response to a letter written by Essar. (Annexure J). Interference by Mr Salman Khurshid in this matter is not an isolated case. He has done it in the case of Swan Telecom also while he was the Minister of Corporate Affairs. Vide a letter dated December 24, 2010 (Annexure-K) by MCA addressed to the DoT, which was also approved by Mr Khurshid, clean chit was given on the violation of cross-holding norms by Swan Telecom. This opinion was sent even after the CAG had serious doubts over Reliance effective control over Swan, the unequivocal complaints that had been made against Swan and the order dated 16.12.2010 of the Supreme Court directing a court-monitored investigation. This opinion is also being used by the accused before the courts while seeking quashing of the charges. Ironically, in both the cases, CBI ultimately disagreed with Mr. Khurshid and went ahead in filing chargesheets against Reliance & Swan, and Essar & Loop. (Annexure L)

63 Abusing one’s official position to benefit a party accused of serious criminal offences apart from being punishable under Prevention of Corruption Act, also makes him part of the criminal conspiracy.

64 Mr. G K Vasan In the decade of 60’s and 70’s about 16 thousand acre of land belonging to the Kandla Port trust was given on lease on meager rates. The companies pay Rs 144, per acre, per annum despite the Ministry of Shipping own guidelines clearly stating that the rent should be six per cent of the market rate of the port land. It is said that the losses incurred due to this are to the tune of Rs 2,00,000 crore. In 2007 and 2008, the chief vigilance officer of the Kandla Port trust in his report to the ministry of shipping had unearthed the entire scam. He sent various reports to the Ministry of Shipping, however no action was taken. In July 2008, he made a detailed report bringing out the role of Ministry of Shipping in the entire land scam. The said report is annexed as Annexure A. The said report had clearly indicted Jt. Secretary in the Ministry of Shipping Mr. Rakesh Srivastava. The report stated that the land –worth crores of rupees—was allotted on lease for a period of thirty years without being auctioned or evaluated. Out of this land 9 thousand acres were transferred to a single family. According to terms and conditions the lease was not supposed to be renewed but in 1996 and 2000 it was renewed for a period of four years each time. In 2004 when the lease on 37 out of 42 units ended, these families conspired with the top officials, the leases were simply allowed to sit on that land without any lease and without paying any rent. Despite the scam, on July 13, 2010, the shipping ministry under Mr. Vasan ordered for the renewal of 38 leases till 31st March 2011. On 11th August, 2010 the Delhi High Court asked as the Shipping Secretary to personally file an affidavit explaining how the said permission was given. (Annexure B) The Secretary in his affidavit said that Jt. Secretary met the Minister Mr. Vasan and got the leases renewed. (Annexure C) So here was a clear case of abuse of ministerial power by Mr. Vasan in connivance with a tainted officer. Delhi HC on 11.03.2010 ordered CBI investigation. (Annexure D) CBI asked the Ministry to move out Jt. Secy Mr. Rakesh Srivastava. (Annexure E) Mr. Vasan rejected the request. Finally HC on 03.06.2011 directed that Jt. Secy shall not deal with KPT matters and would not interfere with the proble. (Annexure F) CBI in its Jan 2012 status report said that they have recommended departmental action against Jt. Secy but the Ministry under Mr. Vasan has rejected the recommendation. (Annexure G) HC asked the CVC to look into the matter. On 16.05.2012, CVC told HC that it has recommended to the Ministry to initiate regular departmental action against Jt. Secy. (Annexure H) HC has now asked the Ministry to take a decision on CVC's recommendation. HC also ultimately had to order

65 eviction of the unauthorized occupants, and that fresh leases would only be awarded through auction. (Annexure I). Therefore, from the above it is clear that Mr. Vasan abused his position to let the scam continue to the detriment of public exchequer, he tried to cover-up the scam and also to shield the accused. Therefore his conduct needs a thorough investigation.

66 Mr. Farooq Abdullah Jammu and Kashmir Cricket Association Scam: Mr. Abdullah is the President of Jammu Kashmir Cricket Association. A former treasurer of JKCA, Mr Ahsan Mirza, who is considered a close aide of Mr Abdullah, had been suspended from the association for charges of frauds. BCCI sends a lot of funds to JKCA to promote cricket in state. The allegation against Mr Mirza was that he had opened bogus bank accounts in various banks in the name of association and had siphoned off association’s money (approximately Rs 30 crore), through these bogus accounts. Mr Mirza has been suspended from the association and there is a FIR registered against him. Mr Mirza had opened one such bogus account in Khaniyar branch of J&K where association’s money was stashed. Mr Abdullah had asked the Khaniyar branch to give a loan of Rupees 2 crore to Mr Mirza on the basis of funds of association deposited in that branch which is clearly illegal. Mr. Abdullah could not have recommended allotment of a personnel loan to Mr Mirza on the basis of organization’s funds. This shows close proximity between the two and also shows a prima facie case of Mr. Abdullah being involved in the foresaid siphoning of the fund of the Cricket Association. J&K High Court has also issued notice to the JKCA in a PIL seeking CBI investigation. Copies of the newspaper reports (Tehelka 13th March 2012, Pioneer dated 26th March 2012 & Indian Express dated 3rd April 2012) as Annexure A (Colly) along with copy of the letter from Branch Head J&K Bank to the chairman of JKCA dated 10th March 2012 are enclosed herewith as Annexure B. The foresaid act prima facie amounts to criminal misconduct and also offence under Indian Penal Code and hence an independent and fair investigation is required.

67 Mr. M K Alagiri Interfered in the duty of an election officer: In April 2011, DMK leader Mr. M K Alagiri and his fifty supporters were charged for the breach of code of conduct and attacking an election officer, M Kali Muttu, and his co-worker during the Assembly election in Tamil Nadu. Reportedly, Mr. Alagiri was campaigning in a temple in Melur Talu area when a flying squad of the election commission reached the spot and started to video-graph his activities. This made Mr. Alagiri’s supporters turn angry and they attacked the videographer and the election officer. The officer, who was on official duty, was abused by his supporters and forced to retreat. Copies of reports in Outlook India dated 2nd April 2011 and IBN Live 23rd January 2012 are enclosed herewith as Annexure A (Colly). Temple land grabbed by Mr. Alagiri’s wife Kanti Alagiri A priest of a temple in Madurai, Subramanian Iyer, has complained to the chief minister that Mr. Alagiri’s wife Kanti Alagiri has grabbed 23 acres of temple land. According to the priest, the said piece of land was, in 1936, gifted to the temple by Mr. Nagendra Iyer on the condition that the piece of land would never be sold. Despite this, the land was sold by disputed lottery king, Saint Yago Martin, after forging documents, to Kanti Alagiri for a sum of Rupees 85 lakhs. It is said that the actual price of the land is about Rs 24 crore. Despite the complaint, no FIR has been registered in this case. It appears some preliminary investigation was done by Madurai rural police which gave clean chit to Mr. Alagiri’s family. Copies of the Indian Express dated 7th July 2011 and 5th September 2011, India Today dated 12 July 2011, and IBN Live dated April 11, 2011 reports are enclosed as Annexure B (Colly). The aforesaid acts prima facie amounts to offences under Indian Penal Code apart from being misconduct and hence independent and fair investigation is required.

68 Mr. Sushil Kumar Shinde Adarsh Scam The issue relates itself to cheating, fraud, and corruption practised by Mr. Sushil Kumar Shinde along with some others, in the matter of allotment of flats to specific members of the Adarsh Co-operative Housing Society situated at Plot No. 87-C at Backbay Scheme No. (VI), Cuffe Parade, Mumbai. Vide the order of the Government dated 11 January, 2003, a Letter of Intent was issued to Adarsh Co-operative Housing Society for allotment of land admeasuring 3758 square metres at the address mentioned above. This tentative letter of intent was issued to enable the Collector of Mumbai of verify the antecedents of the proposed members and to ensure that they abide by the criteria set in the Government Resolution of 9th July, 1999. The relevant part of the criteria set in the Government Resolution is annexed hereto and marked as Annexure -'A'. Consequent upon the said verification of the Collector done from time to time, several reports were sent by the Collector to the Revenue Department of the Government of Maharashtra for the approval of names and the issuance of the letter of allotment from time to time. In this reference, the following orders were issued as under: (a) (b) (c) (d) Order dated 9th July, 2004 approving 20 names. (ANNEXURE'B') Order dated 24 August, 2004 approving 51 names. (ANNEXURE-'C') Approval issued on 20th September for the allotment of land @ 1,15,000/- per square metres.(ANNEXURE-'D') Approval granted in late October, 2004 based which letter issued on 11th November, 2004, for charging a lesser price for land for those in lower income categories. (ANNEXURE-'E') Mr. Shinde was the Chief Minister, Maharashtra State from 18th January 2003 to 31st October, 2004. Mr. Shinde along with other persons entered into a criminal conspiracy to effect an illegal allotment of land to members of the said Society, thereby causing an undue pecuniary gain to such persons and which, inter alia, comes within the definition of the words, ‘criminal misconduct by a public servant’ as contained in section 13 of the Prevention of Corruption Act, 1988. ALLEGATION NO. 1: Falsification of file notings done by manipulating the date of 23rd August, 2004, for issuing allotment to 51 members because that was the last day before Code of Conduct for elections was imposed:

69 As per the programme for elections announced by the Election Commission of India, (ANNEXURE-'F'), the Code of Conduct was to remain in force from 24th August, 2004 till the new Government was formed on 1st November 2004. However, it was seen that the Code of Conduct for Elections was to start from 24th August 2004. Accordingly, as per the instructions issued by the Election Commission of India, no order could be passed beyond the date of 23rd August, 2004. To overcome the constraints mentioned above, a conspiracy was hatched, whereby there seems to be noting done on the back date by antedating the date of 23rd August, 2004. This inference is apparent from the following: (I) As per the prescribed procedure, when a noting is done by a Department, and when the file moves from a Mantralaya Department to the Chief Minister’s Office, there is a stamp which is placed. This can be seen in a noting annexed as ANNEXURE-'J'. In this case, a fake papers were prepared as seen in the noting dated 23rd August, 2004, annexed as ANNEXURE-'G', no stamp has been put. (II) There is an overwriting in the noting of Joint Secretary Shri Asmar, who it seems had put the date as ‘24’ which was then changed to ‘23’ (ANNEXURE-'G'). A forensic examination of the original documents available with the Revenue Department can reveal the detail specifically with respect to overwriting. (III) SR. NO. 1. 23rd 2004 2. 3. 4. 23rd 2004 23rd 2004 23rd 2004 On 23rd August, 2004, the file moved as under: DATE OFFICER DOING NOTING August, Under Secretary Proposal members. August, Joint Secretary, Shri - AgreesAsmar August, Principal RC Joshi August, Deputy Secretary to He the Chief Minister has to study the file and put up to Principal Secretary to Chief Minister Secretary, - Agreesto allot flat to 51 REMARKS

70 5. 23rd 2004 August, Principal Secretary He has to

to Chief Minister.

study the file and put up to the Minister. Chief

6. 7.

23rd 2004 23rd 2004

August, Chief Minister August,

- AgreesFile has to

return through Principal Secretary Rev (like ANNEXURE'K') in


23rd 2004

August, Under Secretary

Puts up draft allotment letter.

9. 10. 11.

23rd 2004 23rd 2004 23rd 2004

August, Jt.


Shri - Agrees-

Asmar August, Principal Secretary - AgreesHe issues the letter members. of allotment to 51 Rev, Shri Joshi August, Under Secretary

From the aforesaid facts the following is apparent: (a) It is physically impossible for a file to move 11 times in one single day across from the desk to various officers and offices and the same be dealt on a complicated matter as this one. I.e. from Revenue Department to Chief Minister’s Secretariat and back with each of the officers and the Chief Minister’s Secretariat applying its mind. (b) The Revenue Secretary Shri RC Joshi, did not submit the case to the Revenue Minister as per the rules and as was done in all similar matters. As per the Maharashtra Government Rules of Business the following has been provided: “Except as otherwise provided in these instructions, cases shall be submitted by the Secretary in the Department to which the case belongs to the Ministerin-charge”.

71 In a major violation of rules, in this case, Secretary Shri Joshi did not submit the file to the Revenue Minister. This conduct was not only suspicious but also illegal. (c) The matter was not referred to Finance Department as was done in several other instances. As per Rule 11 of the Maharashtra Government Rules of Business for any matter related to any concessional allotment of land, the matter has to be referred to the Finance Department. This was not done by him as was done when he had got the names of 20 people approved. (d) As per the Supreme Court ruling in the case of Angariki Cooperative Housing Society, Finance is the life blood of the Government and if in any matter related to allotment of land is not referred to the Finance department then the same is illegal. (e) There are overwriting in the signature of Ramakant Asmar Joint Secretary (ANNEXURE-'G'). This indicates that there has been some falsification of documents. (f) There is also an overwriting in the note made on 24th August, 2004 (ANNEXURE-'H'). This also indicates falsification of documents. (g) As per the rules and procedures when the file moves from the Revenue Department to the Chief Minister’s Secretariat, there has to be an outward and inward stamp of both the Chief Minister’s Office and also of the Revenue Department. This can be seen from a proper noting placed as ANNEXURE-'K'. However, in this case of fake noting placed at ANNEXURE-'G' there is no stamp at all. This clearly, indicates that false papers were prepared. It is thus seen that fake noting was prepared on 23rd August, 2004 so as to escape from the constraints imposed by the Election Code of Conduct which was to come in force on 24th August, 2004. ALLEGATION NO. 2: Allotment of flat to 51 members was made on 24th August, 2004 on which date Code of Conduct had commences – order could not be issued: It is seen from order dated 24th August, 2004 annexed as ANNEXURE-'C' and the corresponding noting placed at ANNEXURE-'H', the order of allotment was issued on 24th August, 2004, when the Code of Conduct for Elections had already come into force. As per the instructions issued by the Election Commission of India, the Code of Conduct had been

72 enforced from the date when the elections were announced. The date of announcement of elections was 24th August, 2004 (ANNEXURE-'F'). However, the allotment letter for 51 members was issued on 24th August, 2004. Thus the said letter was illegal and violates the instructions of the Election Commission of India. It also amounts to an offence under section 171-B of the Indian Penal Code and also a corrupt practice under section 123(1) of the Representation of the People Act, 1951. ALLEGATION NO. 3: When the Election Code of Conduct was on orders were issued to give land at 20% of market value – gross violation of the Code and a criminal offence: A noting was put up on 16.9.2004 before the Chief Minister Shri Shinde as can be seen from ANNEXURE-'I'. Notwithstanding the fact that the Code of Conduct was in force, yet orders were issued to grant land at 20% of the market value. As can be seen from ANNEXURE-'I', this noting was approved by the Chief Minister around 16.9.2004. This act was grossly illegal for the following reasons: (a) During the relevant time Code of Conduct for Elections was in force. In no way could any order be issued for giving concessional allotment of land at 20% of the market value. This would clearly amount to bribery and inducement to voters which is an offence under section 171-B of the Indian Penal Code and also a corrupt practice under section 123(1) of the Representation of the People Act, 1951. (b) As seen above, Rule 6 contained in the Instructions issued under the Maharashtra Government Rules of Business, it was required for the Secretary to have put up the file to the Revenue Minister. This is apparent from the following provisions: “Except as otherwise provided in these instructions, cases shall be submitted by the Secretary in the Department to which the case belongs to the Ministerin-charge”. However, The Revenue Minister was bypassed and the file was directly put up to the Chief Minister. (c) It was the condition of the Finance Department that allotment be done as per the eligibility norms of Government Resolution of 9th July, 1999. However, in this respect Government had granted concession to several people from domicile requirement in violation to the said Government Resolution of 1999. Hence this condition of the Finance Department was broken. As such, as per Rule 11(2) of the Maharashtra

73 Government Rules of Business, it was necessary to refer the matter to the Council which could not be done because of the fact that the Code of Conduct was in force. ALLEGATION NO. 4: Total Collapse of Rule of Law – Even price of 20% of market value was reduced without concurrence of the Finance Department when the Code of Conduct was in operation and when the Government Resolution of 1999 already stood violation by including members without following the domicile criterion: A note was put up on 7th October, 2004, (ANNEXURE-'J') on the request made by Adarsh Co-operative Housing Society that the price of 20% of the market value be reduced to those in the lesser income category. This order was approved by the Chief Minister, Shri Shinde perhaps on the last day he was in the chair. The new Chief Minister, Shri Deshmukh had taken Oath on 1st November, 2004. In this act the following illegalities happened: (a) The Finance Department had earlier given approval for 20% of market value. To change this pricing, it was required that the matter be referred to the Finance Department. This was more particularly required because the Government Resolution had been breached by permitting several members who did not qualify (b) the domicile criteria. However, this mandatory reference to the Finance Department was not done. As per the Maharashtra Government Rules of Business, and also as per the ruling of the Hon'ble Supreme Court in the case of Angariki Co-operative Housing Society, it was necessary to have referred the matter to the Finance Department since the matter related to relinquishment of Revenue. This can be seen from the following legal provisions contained in the said Rule 11. Rule 11 of the Maharashtra Government Rules of Business issued under Article 166 of the Constitution of India: (1) No Department shall without previous consultation with the Finance Department authorize any order (other than orders pursuant to any general delegation made by the Finance Department) which – (a) either immediately or by their repercussion, will affect all the particular (i) involve any grant of land or assignment of revenue or concession, grant lease or license of mineral or forest finance of the State, or which, in

74 rights or a right to water power or any easement or privilege in respect of such concession; or (ii) in any way involve any relinquishment of revenue; (b) relate to the number or grading or cadre of post or the employments or other conditions of service or posts. (2) No proposal which requires the previous consultation of the Finance Department under sub-rule (1) but in which the Finance Department has not concurred, may be proceeded with unless a decision to that effect has been taken by the Council. (3) No appropriation shall be made by any Department other than the Finance Department, except in accordance with such general delegation as the Finance Department may have made. (4) Except to the extent that power may have been delegated to the Departments under rules approved by the Finance Department, every order of an Administrative Department conveying a sanction to be enforced in audit shall be communicated to the audit authorities by the Finance Department. (5) Nothing in this rule shall be construed as authorizing any Department including the Finance Department, to make reappropriations from the grant specified in the Appropriation Act to another such grant.” (Emphasis supplied). It is seen that notwithstanding the aforesaid stipulation, yet this matter of relinquishment of revenue and grant of land at a concessional rate was not referred to the Finance Department. (c) As per the Maharashtra Government Rules of Business, it was necessary for the Principal Secretary Revenue to have routed the file through the Revenue Minister. However, in view of the fact that the elections were on, it seems the Revenue Minister was not inclined to sign on the file. Hence this file was then marked directly to the Chief Minister, Shri Shinde, without referring it to the Revenue Minister, in violation of the rules, where then the former signed on the file. (d) During the time Election Code of Conduct was on, in no way, could there be an approval for giving concessional price to the Society where relinquishment of revenue was involved. It

75 amounted to an offence under section 171-B of the Indian Penal Code and also a corrupt practice under section 123(1) of the Representation of the People Act, 1951. ALLEGATION NO. 5: That the letter of allotment of land on 9th July, 2004 was issued notwithstanding the fact that there was no clear-cut approval from the Finance Department: As per the Maharashtra Government Rules of Business the following has been provided for: Rule 11 of the Maharashtra Government Rules of Business issued under Article 166 of the Constitution of India: (1) No Department shall without previous consultation with the Finance Department authorize any order (other than orders pursuant to any general delegation made by the Finance Department) which – (a) either immediately or by their repercussion, will affect all the particular (i) involve any grant of land or assignment of revenue or concession, grant lease or license of mineral or forest rights or a right to water power or any easement or privilege in respect of such concession; or (ii) in any way involve any relinquishment of revenue; (b) relate to the number or grading or cadre of post or the employments or other conditions of service or posts. (2) No proposal which requires the previous consultation of the Finance Department under sub-rule (1) but in which the Finance Department has not concurred, may be proceeded with unless a decision to that effect has been taken by the Council. (3) No appropriation shall be made by any Department other than the Finance Department, except in accordance with such general delegation as the Finance Department may have made. (4) Except to the extent that power may have been delegated to the Departments under rules approved by the Finance Department, every order of an Administrative Department conveying a sanction to be enforced in audit shall be communicated to the audit authorities by the Finance Department. finance of the State, or which, in

76 (5) Nothing in this rule shall be construed as authorizing any Department including the Finance Department, to make reappropriations from the grant specified in the Appropriation Act to another such grant.” When the proposal for the issuance of the letter of allotment was given to the Finance Department the following noting was made from 16th June 2004 to 8th July, 2004 (ANNEXURE-'J'): “If the view of the Revenue Department in this proposal under the conditions of Government Resolution of 9th July, 1999 with reference to Co-operative Housing Societies, is found proper, then the Finance Department could give its concurrence. This is because, in this way, by not following the eligibility criteria conditions, to give a Letter of Intent, such precedents have not been seen before. The price which has been proposed by the Department, the Finance Department could give its concurrence. Because that this proposal appears to be different than that which should be as per the prescribed procedure, in that on the condition that the Department which has to take the approval of the Government can take the decision on its own, it seems for this there can be no objection. As per the standing order, submitted for the perusal and decision of the Hon'ble Minister (Finance).” (Emphasis supplied). This note was approved by the Finance Department as per the following remarks (as translated from Marathi): “The department should take the approval of the government on this condition the concurrence be given.” It is submitted that this proposal was then put up to the Chief Minister Shri Shinde by the Revenue Minister Shri Nilengekar Patil which was approved by the former (ANNEXURE-'J'). In this reference the following is submitted: (a) The Finance Department had raised an objection as under: (1) Issuance of Letter of Intent with the members not following the eligibility criteria, this was not proper. (2) The proposal was different from that of the prescribed procedure, hence the Revenue Department need to take approval of the Government. In view of the above, since the Finance Department had clearly said that the proposal was not as per the prescribed procedure, by stating that the approval of the Government be taken, it meant that the conditions mentioned in the Rules of Business, Rule 11(2), as quoted above, need to be followed.

77 In other words, the approval of the Council was required. However, for apparent reasons the approval of the Council was not taken and the Letter of Allotment was issued on 9th July, 2004 as per ANNEXURE-'B' when the same was approved by the Chief Minister Shri Shinde. ALLEGATION NO. 6: Chief Minister cannot claim that this was a routine matter – in this matter he has been taking SPECAIL personal interest again and again hence was fully aware of all the happenings: That the Chief Minister took special and personal interest in this case is evident from the following: (a) This file was called by the Chief Minister’s Office without assigning any reason on 26 July, 2003 and was kept upto 18th August, 2003. As to why the file was called, there was no noting at all. That the file was called by the Chief Minister is evident from ANNEXURE-'L'. (b) 1. 2. That there were special references coming from the Chief Minister again and again. This is apparent from the following: Letter dated 29th March, 2003 written by Chief Minister to Shri Gidwani for getting matter examined (ANNEXURE-'M'). Letter of 17th March, 2003 for getting additional FSI sent by Adarsh Co-operative Housing Society to the Chief Minister. (ANNEXURE-'N'). 3. Letter of Shri Gidwani to the Chief Minister, dated March 21, 2003 to where Chief Minister instructed matter to be put up (ANNEXURE-'O'). 4. Letter of Under Secretary Revenue Department to Shri Thakur Chief Promoter dated 10th April, 2003, where the letter was marked as copy to Collector Mumbai stating that the Chief Minister 5. Letter of has Shri instructed Karnik, to Desk give the of report Chief at once (ANNEXURE-'P'). officer Minister Secretariat, dated 17th July, 2003 instructing the Revenue Department to put up the matter at once (ANNEXURE-'Q'). 6. Letter of Shri Gidwani to Chief Minister dated 24 December, 2003, enclosing the letter of Adarsh Co-operative Housing Society, where the Chief Minister order the Secretary Revenue to examine the matter and to put up (ANNEXURE-'R'). 7. Letter dated 2nd January, 2004, of Private Secretary to the Chief Minister, asking prompt action on the letter of Shri Gidwani. (ANNEXURE-'S').

78 8. Letter of Jt Secretary Shri Asmar of Revenue Department dated 22 June, 2004 marking a copy of the letter to Collector to eh office of the Chief Minister. (ANNEXURE-'T'). 9. Letter of 27 July 2004 of the Collector to Urban Development Department stating that the special desk of the Chief Minister is asking for the matter hence the same be expedited (ANNEXURE-'U'). 10. 11. Note submitted by Shri Gidwani to the Chief Minister dated 12th August, 2004 on pending matters (ANNEXURE-'V'). Letter dated 11th September 2004 submitted by Shri Gidwani to the Chief Minister for issuing directives for additional FSI (ANNEXURE-'W'). 12. Letter dated 19th August, 2004, submitted by General Manager BEST to the Secretary to the Chief Minister Shri Subhash Lalla (ANNEXURE-'X'). Prima facie, in view of the submissions made above, the following criminal offences (a) have been committed and which warrant an in-depth investigation: Section 120-B IPC i.e. criminal conspiracy of the accused persons to allot flats to members in violation of the provisions of law. (b) 409 IPC i.e. criminal breach of trust by a public servant where the precious land which was government property was transferred (c) to Adarsh Co-operative Housing Society in violation of the law. 420 IPC for cheating the government by seeking membership for the mother and daughter of Shri Lalla on fake papers and declaring her to be in MES service whereas actually she was a housewife. (d) 467 and 471 of the IPC i.e. creating and using fabricated documents for preparing papers on backdate, in violation of the office procedures of doing inward and outward entries of noting, purported to be done on 23rd August, 2004 which was the last working day before Code of Conduct for Elections was to come into force. (e) 467 and 471 of the IPC i.e. creating and using fabricated documents to get membership in the Society for Shrimati Susheela Shaligram and others. (f) Section 13(1)(d) read with section 13(2) of Prevention of Corruption Act, 1988 – commission of the offence of criminal

79 misconduct where Rules of Business were violated so as to confer precious flats worth about Rs. 8 cr. each to those who were members of Adarsh Co-operative Housing Society

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