Loop Telecom was created by the Essar Group to obtain 2G licences: CBI to Supreme Court

The Central Bureau of Investigation (CBI) has informed the Supreme Court that it is of the opinion that Loop Telecom was created by the Essar Group to illegally obtain 2G licences. A status report filed by the CBI, which outlined the progress of its investigation of the 2G spectrum issue, rejected the view of the Ministry of Corporate Affairs that the Essar Group did not hold a majority stake in Loop Telecom.

CBI counsel K.K. Venugopal told a Supreme Court bench, “The applicant company (Loop) was operating under the corporate veil of the main company (Essar) and was nothing but an alter ego of the main group. Hence, the declaration made by the applicant company was false and is an offence.? The CBI also said the role of Prashant Ruia, CEO, Essar Group is being scrutinised.

The CBI also said that it had found no evidence amounting to former Minister of Telecommunications and IT, Dayanidhi Maran, coercing Aircel chief, C. Sivasankaran to sell his stake in Aircel to Maxis.

However, Venugopal said that while there was no coercion, there was deliberate and undue delay in the grant of spectrum to Aircel, as long as Sivasankaran was holding stakes in the company. After Maxis took over, however, the company was speedily granted spectrum.