Info-tech

2G: Reliance Telecom denies Swan was its front company

| | Updated on: Aug 10, 2011

Reliance Telecom Ltd (RTL) on Wednesday denied allegations that Swan Telecom, which got the 2G licence, was its front company.

RTL – an accused in the 2G spectrum case – also told the Special Court that though it initially had 9.9 per cent equity in Swan, it did not have any stake in the latter at the time of grant of 2G licences in 2008. RTL claimed that, therefore, it cannot be held liable for criminal conspiracy.

The CBI had alleged that RTL had used Swan as a front company to circumvent the then telecom policy. The Department of Telecom guidelines had prohibited a telecom company, with licence, from holding over 10 per cent stake in another telecom company.

RTL’s counsel said that at the time of issuance of the letters of intent to Swan, RTL was not in the picture, adding that by then “Balwas (Mr Shahid Balwa and other promoters of Swan) had taken over the firm.” RTL said it had sold its preference shares of Swan to a company belonging to Balwas in October 2007, and 9.9 per cent equity shares were also sold to Delphi Investment, another independent company.

RTL also said Swan was not its associate company, adding that it did not have any say in deciding Swan’s board members. RTL also said no criminal intent can be attributed to it. The court is hearing arguments on framing of charges against the accused.

Published on March 12, 2018

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