Reliance Jio 4G scam: AAP demands CBI probe

AAP leader Arvind Kejriwal has demanded BJP Govt led by Narendra Modi to cancel telecom license and 4G spectrum to Reliance Jio Infocomm. The party has demanded CBI probe into the LTE 4G scam.

Earlier, AAP leader and senior lawyer Prashant Bhushan filed a PIL in the Supreme Court seeking cancellation of Reliance Industries’ telecom license and a through criminal investigation. Supreme Court had issued a notice to the Government and Reliance on that petition on 9 May 2014.

Kejriwal, former chief minister of Delhi, said in his party’s blog post that the UPA Government in March 2013 allowed a back-door entry of Reliance Jio Infocomm into voice telephony in violation of the judgment of the Supreme Court in the 2G case.

Despite demand from telecom operators such as Bharti Airtel, Vodafone, Idea Cellular, etc. to cancel permission to Reliance Jio to offer voice services using BWA license, the then DoT secretary R Chandrashekar earlier clarified that the government gave nod within the existing guidelines.

Though Reliance Jio can offer both data and voice services using the BWA license, the company did not launch 4G LTE services and the company recently stated that the much awaited services will be available in 2015.

Also read: Reliance Jio feels the heat as CAG suggests cancellation of 4G license

The Mukesh Ambani promoted Reliance Jio Infocomm has already denied any malpractices in the 4G spectrum license saying the company has followed the Government of India guidelines.

MUKESH AMBANI

The inside story

During May-June 2010, the 3G auction fetched Rs 16,750.58 crore for 5+5 MHz spectrum in 2100 MHz band (Rs 1,675 crore per MHz). 4G auction fetched Rs 12,847.77 crore for 20 MHz pan-India license in the 2300 MHz band (Rs 642.39 crore per MHz). The price difference was so because documents stated that 4G spectrum was for data services only, whereas 3G spectrum can be used for both data and voice telephony.

Infotel Broadband Services (IBSPL), which emerged as the only company to have acquired pan-India 4G spectrum, had an Internet license since November 2007 and had just one subscriber with revenue of Rs 16.28 lakh during 2009-10, and its authorized share capital was Rs 3 crore and the paid up capital was Rs 2.51 crore. Infotel Digicomm (IDPL) held 99.99 percent share of the IBSPL at the time of submission of application in March 2010, said AAP.

Within hours of completion of 4G auction on 11.06.2010, IBSPL increased the authorized share capital from Rs 3 crore to Rs 6,000 crore. On 17.06.2010, the company authorized its Board of Directors to allot 475 crore equity share of Rs 10 each to Reliance Industries (RIL) and 25 crore equity share of Rs 10 to Infotech Digicomm (IDPL) aggregating to the equity capital of Rs 5,000 crore.

On the same day, the company also decided to change from a private company to Public Limited Company (Infotel Broadband Services Ltd). Thus, the company within a week of winning the 4G spectrum disposed off 95 percent shares to RIL while 5 percent was retained by IDPL. Much later in March 2013, the company was renamed as Reliance Jio Infocomm Pvt Ltd.

If Ravi Shankar Prasad, the telecom and IT minister decides to take a look at the 4G license and plan tough actions, it will impact Reliance Jio Infocomm’s future plans, the Congress led UPA government, TRAI and DoT officials, etc. This will also further strengthen TelecomLead.com’s demand to have transparency in decision making by the India government.