The Special Court has said that non-revision of entry fee or spectrum charge in itself is not an illegal act, unless done with a criminal intent.

The court said that Mr Chidambaram had agreed with the then Telecom Minister, Mr A. Raja, not to revise or re-visit (in 2008) the entry fee or spectrum charge as discovered in 2001.

Cabinet note

The court also said there is material on record including a Cabinet note of October 21, 2003, that the decision regarding spectrum pricing was to be taken by the Finance Minister and the Telecom Minister.

“After this decision was taken, Mr P. Chidambaram agreed that it would be the price as discovered in the year 2001 and also told Mr A. Raja that there is no need to re-visit the same. This decision was subsequently conveyed to the Prime Minister also,” the court said.

However, the court said: “Non-revision of prices is not an illegal act by itself. The competent authority is always at liberty to decide in its discretion to not to revise the prices or fee for any goods or services. The same entry fee/spectrum charges continued even after 2007-08.”

It also observed that the allegation against Mr Chidambaram included permitting two companies, which received the licence, namely Swan Telecom and Unitech Wireless, to dilute their shares even before roll-out of their services.

“Same is the case with dilution of equity by a company. It is not per se illegal nor was it prohibited at the relevant time. However, such acts may acquire criminal colour/overtones when done with criminal intent,” it said.

The court said there is no material on record to show that Mr Chidambaram's action was mala fide in fixing the price of spectrum at the 2001 level or in permitting dilution of equity by the two companies.

(This article was published on February 4, 2012)
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