New Delhi, Dec. 21: The CBI today filed a chargesheet against Bharti Airtel and Vodafone, and former telecom secretary Shyamal Ghosh for alleged irregularities in the allocation of additional 2G spectrum in 2002 when the BJP-led NDA was in power.
No promoter of any of the two companies has been named, though.
The CBI has alleged that the decision to allocate the additional spectrum was a conspiracy to benefit the companies. Pramod Mahajan, who died in 2006, was then telecom minister. But as cases can't be filed against the dead, he has not been charged.
The accused have been booked for criminal conspiracy and under the Prevention of Corruption Act. The two companies declined comment.
The telecom ministry under Mahajan introduced spectrum-allocation rules based on the number of subscribers, under which companies were awarded an additional unit of 1.8 Mhz of airwaves subject to them meeting certain pre-defined customer numbers.
While a technical committee of the department of telecom had recommended allotting additional spectrum beyond 6.2 Mhz only after the operators reached a subscriber base of 9 lakh, the requirement was reduced to 4 lakh.
The CBI also alleged that the department increased the base spectrum ' which comes bundled with the licence fee to start operations ' from 4.4 MhZ to 6.2 MhZ during Mahajan's tenure from 2001 to 2003.
In 2002, Bharti Airtel got 1.8 Mhz of spectrum in the efficient 900-Mhz band in Delhi and 6.2 Mhz in the 1,800-Mhz band in Mumbai. Vodafone India got 1.8 Mhz spectrum in the 900 Mhz band in Delhi and Mumbai, besides 6.2 Mhz in the 1,800-Mhz band in Chennai.
The 900 Mhz and 1,800 Mhz bands are used to offer second-generation GSM services, mainly for calls and limited-speed data transfer. However, the 900-Mhz band is considered more efficient as a smaller quantity of spectrum can accommodate more subscribers.
Delhi and Mumbai have greater numbers of mobile users, with average revenue per user higher than in smaller towns and cities.
According to the CBI, the additional spectrum gave unfair advantage to the mobile firms and led to a loss of over Rs 800 crore for the exchequer.
A former private secretary to Mahajan has disclosed that in a high-level meeting, technical advisers had said better use of technology could obviate the need for additional spectrum.
But Mahajan insisted that the extra allocation was necessary for growth, the secretary claimed, and this sealed the decision the same day.
The CBI has already filed an FIR against Ghosh, the ex-telecom secretary, for entering into a conspiracy with Bharti Airtel and Hutchison Max (now Vodafone India).
The agency has alleged that an internal note by the department of telecom on the January 31, 2002, meeting had "wrongly" mentioned that a consensus had emerged on allocating the additional spectrum.
The final approval was given by Mahajan on the same day "in haste", the agency.
Industry representatives said the chargesheet contradicts the stand taken in Parliament by the telecom ministry that the additional allocation was in line with laws in force at the time.