December 9, 2010 / 11:51 AM / 9 years ago

UPDATE 1-India to set up one-man committee for telco probe

* Former Justice Shivaraj Patil to head inquiry

* Telco min hopes to see inquiry completed in a month

* Inquiry will look into internal ops of telco ministry

* Notices to be sent out this week seeking procedural details

(Adds comments, details)

NEW DELHI, Dec 9 (Reuters) - The Indian government will set up a one-man committee of a former Supreme Court judge to examine the allocation of telecom licences and spectrum, some of which were granted at rock bottom prices, in one of the biggest corruption scandals to hit India this year.

Speaking to reporters, Indian telecom minister Kapil Sibal said former Justice Shivaraj Patil would look into the internal operating procedures of the telecoms ministry and the allocation of licenses and spectrum between 2001 and 2009.

He said he would like to see the inquiry completed in a month.

“We want to look at whether internal procedures were followed or not, if they were deviated from, to what extent, and who was involved in the deviation, if any.”

The case, which revolves around the sale of telecom licenses at low prices, has led to the resignation of India’s telecoms minister, and, according to an official audit, has possibly lost the state $39 billion in revenue.

It has also frozen the country’s parliament for nearly a month as opposition parties have demanded a full parliamentary investigation.

The scandal is one of many corruption scams that has hit India this year, including a bribes-for-loans scam in which eight officials from financial institutions have been arrested.

In its report on the telecoms scam, the Comptroller and Auditor General of India said rules were flouted when the licences were given in 2007 and 2008, and led to many ineligible firms receiving them.

“We are relying on the judge to tell us what was right and what was wrong,” Sibal said. “Objective is to tell the people how spectrum was granted over the years, so that people know what procedure was followed at various points in time and why.”

Companies named in a government auditor’s report on the scam included Uninor, a unit jointly owned by Unitech (UNTE.BO) and Norway’s Telenor (TEL.OL), Etisalat DB Telecom ETEL.AD, into which Swan Telecom and Allianz Infratech later merged, Loop Telecom, Videocon Telecommunications and S Tel.

India’s telecoms ministry has said it would send notices to five companies that were given 85 telecoms licences in 2008, asking why their licences should not be cancelled after the government auditor found the firms were not eligible for them.

The ministry will also send separate notices to 119 telecoms licensees that have not complied with services rollout obligations. Sibal said separate notices would be sent out to companies this week, seeking details on procedural issues. (Reporting by Devidutta Tripathy; Editing by Jui Chakravorty)

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