The doctrine of ‘alter ego’ cannot be applied to the Loop-Essar Group issue: The Essar Group

In a written correspondence to Kapil Sibal, Minister of Telecommunications and IT, the Essar Group has stated that its equity stake in Loop Telecom did not violate telecom licence conditions.

The Essar Group has said that it held only 2.15 per cent shares of Loop, which was below the 10 per cent permissible limit.

Prior to this, the Central Bureau of Investigation (CBI) asked the Attorney General of India for an opinion whether Loop Telecom was the alter ego of the Essar Group.

In its letter, the Essar group stated, ?It appeared that the CBI was seeking to import the doctrine of alter ego to link Loop with Essar. This notion of alter ego is a general doctrine that lacks precision and clarity and thus cannot be imported into criminal jurisprudence in this fashion.?

A parent corporation is considered the alter ego of a subsidiary corporation if it controls and directs its activities so that it will have limited liability.