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Corporate Aug 22, 2013

2G trial: Anil Ambani tells court he’s unaware of Swan Telecom

By Pallavi Polanki

Reliance ADAG Group Chairman Anil Ambani today told a special CBI court hearing 2G spectrum case that he was not even aware of a company called Swan Telecom Private limited (STPL).

"I am not aware of any company by the name of Swan Telecom Limited. Reliance Telecom Limited is a subsidiary of Reliance Communication Limited and I am a non-executive chairman of the latter company. Earlier, I was on the board of Reliance Telecom Limited, but I do not recall the period. I am unable to recall if I was on the board of this company in 2007," Ambani told the court.

CBI's allegation is that Reliance Telecom used Swan Telecom, which was an ineligible to participate in the spectrum auction, as a front company to get 2G licences and spectrum.

Ambani, a prosecution witness, further told the court that while he had visited the CBI office in connection with this case, but he wasn't aware if his statement had been recorded and that he had not handed over any note to the CBI.

With Ambani openly turning a hostile witness, CBI sought permission to cross-examine him on the grounds that he was "resiling from his previous statement".

Asked by the court if he was under pressure or coercion, Ambani said he wasn't.

Ambani appeared as a witness before the court today. PTI

Ambani appeared as a witness before the court today. PTI

Questioned by the judge if was aware that making a false statement in court was a punishable offence, he said, "Yes sir. I know it. "

Ambani declared in court that he was making his statement "voluntarily and as per free will."

Confronted by the prosecution with his earlier statement to the CBI, Ambani told the court, "It is wrong to suggest that Swan Telecom Pvt Ltd (STPL) was a shell company of my group. It is wrong to suggest that it was in my knowledge that STPL had applied for UAS Licence for J&K service area in 2007. I cannot recall if Reliance Telecom had made an investment to the extent of 9.9 per cent in equity shares in STPL."

"I am unable to recall if Reliance Telecom had applied an investment in preference shares of STPL of Re. 1 each with premium of Rs. 999 per share, totaling to Rs. 1000 per share. I cannot say if this investment in equity and preference shares was made to show that the company was compliant with UASL Guidelines. It is wrong to suggest that these facts were discussed with me by Gautam Doshi," he said.

Reliance Telecom executives Gautam Doshi, along with Hari Nair and Surender Pipara, are accused in the case.

Asked by the prosecution if he had been examined by the CBI in connection with the case, Ambani said "yes" but that he did "not know if any statement of mine was recorded or not."

He told the court that he had remained present in the CBI office for many hours and that he did not recall any statement being recorded.

On being shown part of his statement recorded by the CBI (under section 161 of the Criminal Procedure code and therefore not permissible as evidence), Ambani said "I am unable to recall if these facts were told by me to the investigating officer. It is wrong to suggest that it was in my knowledge that STPL had applied for UAS licences in thirteen more service areas. It is wrong to suggest that it was in my knowledge that for applying for more service areas, the company required higher paid-up capital and higher net worth."

"It is wrong to suggest that for this purpose Reliance Telecom Ltd (RTL) purchased further preference shares of Re. 1 at a premium of Rs. 999 from STPL and this was done to maintain net worth criteria. It is further wrong to suggest that it was in my knowledge that it was done so that the investment of RTL remains 9.9 per cent," he said.

His stock answer to a series of questions by the prosecution on the existence of companies, board meetings he attended and transfer of his shares to companies such as Tiger Traders, Zebra Consultants and Parrot consultants were, "I'm not aware" or "I don't recall".

He told the court that he had met former Telecom minister A Raja, accused in the 2G case, on multiple occasions in the capacity of non-executive chairman in connection with the overall development of telecom sector.

He told the court that he " had no occasion to discuss the dual technology issue either with the then Telecom Minister (A Raja) or other officers of the Ministry."

Ambani denied the prosecution's suggestion he had knowledge that Swan Telecom had been structured so as to hide its real ownership.

"It is wrong to suggest that it was in my knowledge that the structure of STPL be created in such a manner that its real ownership should not be known. It is wrong to suggest that I am not disclosing the true facts to this Court in order to save the accused from legal punishment."

Following Ambani's deposition and his cross-examination, senior public prosecutor UU Lalit told the court that "the witness has not supported the prosecution" and that the prosecution would like to call Tina Ambani as witness.

Tina Ambani will depose as prosecution witness tomorrow (23 August).

by Pallavi Polanki

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