It’s A Tragedy That Court Decided Raja Wasn’t Final Authority In Decisions That Led To 2G Scam
The court bought into the argument that officials in the ministry, and not Raja, were the final authority in several key decisions made pertaining to the 2G spectrum allocation process.
This is the second part in the multi-part series analysing Justice O P Saini’s court judgement on the 2G spectrum scam case. (Read part one here.)
Charge: After becoming the information technology and communications minister, A Raja entered into a criminal conspiracy with the directors of STPL, Unitech group of companies, for favouring them in the matter of issue of letters of intent (LOIs), grant of UAS licences and allocation of spectrum. In pursuant of this, the cut-off date 1 October 2007 for receipt of applications for UAS licences was decided.
Prosecution said that the award of UAS licences was a continuous process based on priority and fixed on the basis of date of receipt of applications, and the applications were being received on a continuous basis. Under this method, there was no procedure for setting a cut-off date. But it was done by Raja in collusion with his private secretary R K Chandolia, who directed A K Srivastava to stop receipt of further applications. But when Srivastava objected, Chandolia directed him to put up a note for setting a cut-off date for receipt of applications.
Evidence: On 24 September 2007, the then deputy director general (access service) in the Telecom Department, Srivastava, wrote a note saying, “new UASL applications are pouring in and till date 167 applications from 12 companies for 22 service areas have been received. It is felt that it may be difficult to handle such large number of applications at any point of time. Therefore, it is proposed that we may announce a cutoff date for receipt of UASL applications such that no new applications will be received after cutoff date till further orders. We may give a reasonable time to all who wish to submit new UASL applications so that the decision may not be challenged. The reasonable period may be, say, 15 days. Therefore, we may announce 10.10.2007 to be the cutoff date for receipt of new UASL applications till further orders.”
This file went to member (technology), K Sridhara, and then to secretary (Telecom Department), D S Mathur, and finally to Raja, who changed the cut-off date from 10 October to 1 October, citing three reasons – the large number of applications, to discourage speculative players, and the completion of one month since the date of receipt of the Telecom Regulatory Authority of India’s (TRAI) recommendations (received on 29 August 2007).
The judge said that “there is no mention as to whose proposal was it to have a cutoff date for receipt of applications”, but since the proposal officially originated from Srivastava, “this note would be attributed to Sh. A. K. Srivastava and to none else.”
Yes, but why did Raja advance it further to 1 October 2007 and then to 25 September 2007 retrospectively in October? We will come to that later. First, let’s see what Srivastava said in his deposition.
Srivastava told the court that he was briefing Raja’s private secretary (PS) Chandolia on a daily basis about the details of the applications received through telephone.
On 24.09.2007, when about 167 applications were already received, Sh. R. K. Chandolia asked me whether applications of Unitech group have been received. I enquired from the dealing section and replied back to him that applications of Unitech group have not been received in the section till then. He told me that applications of Unitech group will be submitted to DoT today and thereafter, you should stop receipt of further UASL applications. I told that it was not possible as the new applicants have to be given a reasonable time to apply for UAS licences after a public notice. He then directed me to originate a proposal in the file to put a cutoff date on receipt of further UASL applications. As directed by PS to the then MOC&IT Sh. A. Raja, I originated this proposal in the file proposing that we may announce a cutoff date of 10.10.2007 for receipt of new UASL applications till further orders.A K Srivastava
On another occasion, Srivastava revealed new information to the court. He told that he started the proposal for a cut-off date as he was pressured to do so by Chandolia, who also told him not to reveal to anyone that he was enquiring about Unitech’s application.
In his order, Saini writes that Srivastava is trying to shift the blame to Chandolia when the official proposal has his name on the note. But again, what about Raja advancing it further to 1 October? The judge says that “the possibility of Sh. A. K. Srivastava himself suggesting the date of 01.10.2007 cannot be ruled out”.
So, when it comes to Srivastava, the judge essentially says that the note has your signature and hence you are responsible for it no matter who forced you to do it, but when it comes to the note signed by Raja advancing the cut-off date, the judge doesn’t go by official records and rather speculates about the “possibility of Sh. A.K. Srivastava himself suggesting the date of 1.10”.
Srivastava said Chandolia used to ask about the details of licence applications regularly during phone calls. If that’s the case, one wonders why no phone call records were submitted by prosecution as proof.
Srivastava also told the court that Chandolia asked him on the morning of 24 September 2007 whether Unitech had submitted its application (Srivasatava checked and told him it hadn’t) and directed him to stop the process of collecting applications as soon as Unitech’s application was in. In the afternoon, Chandolia again asked Srivastava if Unitech’s application had been received. Srivastava again checked and this time he reported that the department had received the application.
This series of events matches the official record. Mohit Gupta, the person who submitted the applications for Unitech group of companies for UAS licences in the Telecom Department, said in his deposition that “he went to DoT on 24.09.2007 for submitting the applications at about 10 AM”. However, Saini writes that this “puts the version of Sh. A. K. Srivastava about enquiry from AS Section about the receipt of Unitech applications in doubt”. One is not sure how judge Saini arrived at this conclusion.
However, in the absence of any non-oral evidence, the judge had no reason to believe Srivastava’s testimony that Chandolia, at the instance of Raja, forced him to initiate the note to arrive at a cut-off date. In fact, the judge goes on to state that there was nothing wrong in setting the cut-off date as 10 October or even 1 October, given the large pool of applications the department was getting, and licenses couldn’t have been given to everyone because of unavailability of spectrum.
Judge Saini further notes that “the date of 10.10.2007 or 01.10.2007 would not have made any difference to Unitech group of companies as their applications had already been filed on 24.09.2007. STPL had already applied as early as 02.03.2007.” Fair enough. But at the end of the day, Raja again changed the cut-off date retrospectively in October from 1 October to 25 September, which clearly hints at the intention of helping Unitech, if this line of argument is pursued.
However, here too, the judge bought into the defence’s argument that the 25 September date was proposed by the officers of the Telecom Department, given the unavailability of spectrum. The judge agreed with the defence that three drafts were put forth by officials of the department to seek the opinion of the solicitor general, and that Raja’s role was only that he approved one of these drafts.
In reality though, didn’t the September cut-off date come from Raja, or at his instance? Three drafts prepared and approved by four senior officers in the Telecom Department – Nitin Jain, Srivastava, Sridhara and D S Mathur – called for seeking the opinion of the solicitor general. But when the file came from the minister, it was a modified draft which read:
LOIs to all those who applied by 25/9/2007 (the date on which the cutoff date for receipt of applications were made public through press) may be issued in each service area as it is expected that only serious players will deposit the entry fee and seniority for licence/spectrum be based on (i) the date of application or (ii) the date/ time of fulfillment of all LOI conditions.
But Raja denied in his deposition that he suggested the date. The judge cites the cross-examination of Srivastava, in which he said that the 25 September date was discussed in the ministry and thus may be considered as a proposal by the department.
It is interesting that when a proposal originates from an official in the ministry, it is considered as a proposal of that individual, but when Raja initiates the proposal, it is seen the other way around just because Raja happened to discuss the date with the ministry.
It appears that the ministry was run by officials who were making all the decisions, conveniently benefiting some companies which were arguably close to Raja, who in turn just happened to affix his signature to whatever was suggested to him. He was just an innocent bystander, is the suggestion. And all the while, these same officials insisted that the minister came up with the cut-off date of 25 September, not them.
It’s a tragedy that the court bought into the argument that officials in the ministry, and not Raja, were the final authority.
When the first draft proposing 25 September as the cut-off date emerged, Mathur and Srivastava registered their dissent (but not on the modified draft per se). They wrote:
Opinion of Solicitor General may be obtained as per the draft approved by MCIT. However, the attentionof MCIT may be drawn to NTP 99 para 3.1.1. The policy has stipulated that availability of adequate frequency spectrum is essential for entry of additional operators. Hence the options to issue LOIs/ licences to all 575 applicants do not stand in the light of this provision. NTP 99 was approved by the Union Cabinet and only the Cabinet can effect a change in the policy.
However, judge Saini writes that this note by Mathur reveals that “he suffers from fickle-mindedness in the sense that first he agreed to the proposal to be sent to the learned SG, but when the file came downwards from the Minister, he suddenly acquired all the knowledge about the NTP 1999 and other things, which was not in his possession when he initially agreed with the note during upward movement of the file. Secondly, he is in the habit of putting unnecessary objections at the wrong time. He should have taken this objection when he marked the file to the Minister.”
It would have been better if judge Saini had emphasised on the content of the dissent rather than the timing because the former is more relevant to the case. Who is to decide what is the “wrong time” to raise an objection? One can dissent whenever one feels something is amiss.
After Mathur’s dissent, Srivastava wrote a note explaining NTP 1999 and recommended taking the view of the Law Ministry, a move that was approved by Raja. The ministry in its response recommended that the “whole issue is first considered by an empowered group of Ministers and in that process legal opinion of Attorney General can be obtained”. Raja discussed this advice with senior officials in the Telecom Department, and the conclusion was reached that “the advice was out of context”.
But who termed this advice “out of context”? Let us set this aside for a while and take a look at what the judge had to say about Mathur’s deposition in this regard.
“He has deposed that he took the file to the Minister and told him that the decision of fixing of cutoff date of 25.09.2007 may be considered arbitrary, but he did not record it. However, he also conceded that when he so told the Minister, he (Sh. A. Raja) agreed to reconsider the same. This shows the attitude of the Minister to take note of the opinion of others seriously,” Judge Saini writes in his order.
It is notable how the judge dismisses the first part of Mathur’s statement because there is no record of it but readily believes the second part which shows Raja in good light.
The judge’s point is this – Mathur himself admitted that all 575 applicants who applied till 1 October 2007 couldn’t be allotted spectrum for the lack of availability; then how can one question Raja for deciding on 25 September 2007 as the cut-off date as its purpose was to bring down the number of applicants to match the available spectrum?
Technically, this may sound like a fair point, but it doesn’t mean that the date wasn’t arbitrary, which was exactly the point Mathur had raised. Also, if the department had estimates of available spectrum (which the defence proved in the court that the ministry had had), then why didn’t the ministry stop receiving applications as soon as the threshold was reached? Why did it wait for one month and rendered so many applications invalid retrospectively?
Here’s another point – the prosecution has alleged that the ministry not only changed the cut-off date but also the ‘first come, first served’ procedure. Instead of processing applications on the basis of who applied first, it changed norms and decided to issue spectrum to players who conformed to the terms of LOIs first, i.e., including but not limited to paying the fees. If this was the criteria to be followed, what was the need to announce the September cut-off date? Anyone from the pool of 575 applicants who would submit fees and comply with LOIs first could have been given the spectrum. But instead, the applicants were whittled down to 232, first by an arbitrary cut-off date and then by the change in the ‘first come, first served’ norm.
However, the judge did not find anything wrong in the change in procedure as the evidence establishes that the department had no specific idea of what that term meant. In the past also, the applications were not processed strictly sequentially, leaving a lot of room for interpretation.
But one wonders how all the extraordinary processes were carried out in succession by Raja, which the judge says the former minister can’t be held responsible for, but all these decisions mysteriously helped the very people who are accused of doing indirect business with Raja’s relatives and party members?
TRAI had recommended a “no cap” policy, but instead of berating the minister and the ministry for going against TRAI’s recommendations by setting a cut-off date, and retrospectively at that, the court order questioned TRAI’s policy suggestion. Judge Saini writes: “On the one hand, there was excessive demand for additional spectrum, as there were already six to nine operators in each service area, on the other hand, TRAI still recommended “No cap” policy. This recommendation appears to be contradictory and puzzling. If spectrum is limited, how can unlimited number of licences can be issued? “No cap” policy means as many licences as one wishes to grant. If availability of spectrum is to be taken into account, then naturally there is an indirect cap on the number of operators and all applications cannot be considered at one time.”
If the ministry had any questions about TRAI’s recommendations, it should have approached the body with its issues and tried to work them out. But no! In fact, this was not even discussed with the prime minister as Raja himself admitted in his deposition. “No discussion took place either with the Law Minister or with the Hon'ble Prime Minister for deciding the date of 25.09.2007 as that was not necessary, but it was discussed in the Ministry in the context of policy documents and availability of spectrum. I do not remember if I met the SG on 02.11.2007 for deciding the date of 25.09.2007, but the entire file was sent to him later on for his approval, where this date is available in the file notings,” Raja said.
Raja remembers that he didn’t discuss it with the prime minister or law minister, but doesn’t remember if he discussed it with the solicitor general. Selective amnesia? How could the judge not see through this sophistry? It’s not that difficult to understand why Raja doesn’t remember meeting the then solicitor general. The prosecution has alleged that he too was in on setting the cut-off date as 25 September.
The prosecution’s case was that Raja redefined the concept of the ‘first come, first served’ basis by assigning priority not to those who applied first but to those who complied with the terms of the LOIs first. The judge in his order writes that this was done after discussions within the department and as suggested by the officers of the Telecom Department, and ultimately conveyed to the prime minister, who was also told that this change in policy had the concurrence of the solicitor general – the same one who is believed by the prosecution to have worked hand in glove with Raja and Co.
In any case, why does it matter how it happened? The focus should have squarely lied on why Raja did it. But one wonders if anything can be proved against Raja once the court has believed that he was a mere spectator and was simply affixing his signature to whatever his department officers brought to him.
To be continued...
Why Raja & Co Got Off Scot-Free (Part 1)
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