The new documents submitted by Bhushan showed that Chidambaram not only consented to jailed former Telecom Minister A Raja’s designs, but he also overruled and snubbed the objections raised by top Finance Ministry officials, who tried to prevent the 2G spectrum scam.
The new documents, mostly communications of Finance Ministry, could be damning for Chidambaram. The communication between top officials of Finance Ministry reveal that they fought for more than five months, demanding intervention and cancellation of Letters of Intent (LoIs) issued by Raja on January 10, 2008.
A May 28, 2008 note prepared by Finance Secretary D Subbarao to Chidambaram said, “It is legally and administratively tenable to impose a two-part tariff for spectrum: a fixed, one-time “upfront” spectrum price for allowing the allottees of spectrum to use a public resource for private profit; and a recurring usage charge, whereby Government shares the profits accruing to the operator.”
On the new diluted merger and acquisition guidelines of Raja, the note said, “DoT may be advised that fixation of ‘spectrum transfer charges’ shall be in consultation with DEA.” This was the last ditch effort by the Finance Ministry officials before they gave in.
Forty days later, Raja had his way. The July 6, 2008 note from Subbarao is particularly revealing. It shows that the matter was settled at the level of Prime Minister in the meeting with Raja and Chidambaram on July 4, 2008. The objections of the Ministry were overruled in that meeting. Before the meeting the Prime Minister, Raja and Chidambaram had discussed the matter thrice.
“All the issues have been agreed to as in the note. In particular, it was also decided that the proposal to extend licences for the spectrum overhang period (to make the licence coterminous with the last tranche of spectrum allotted) as discussed in para 12 (on spectrum pricing) of the note will not be pursued because it is administratively and conceptually clumsy and potentially problematic from the legal angle,” Subbarao wrote.
Two months after Raja allotted the Letter of Intent for licence on January 10, a Finance Ministry note of March 11 said that Chidambaram had agreed to their observations and decided to take the matter to Cabinet Committee on Economic Affairs (CCEA) for fixing the price of the spectrum.
The note produced by Bhushan in the Supreme Court starts: “Finance Minister approves suggestion of Finance Secretary to use the Note for CCEA as an opportunity to raise basic issues of pricing of spectrum for the entire range of spectrum under commercial use.” But the fact of the matter is that Chidambaram never took up the matter to neither Cabinet nor CCEA.
Another damning evidence produced before the Supreme Court is that Chidambaram literally snubbed a Finance Ministry official for making an official communication with DoT in the form of an Office Memorandum. The officer argued for creating an Office Memorandum detailing the objections of the Finance Ministry with Telecom Ministry. But Chidambaram cleverly preferred to adopt the non-paper mechanism in communicating with spectrum related issues. The non-paper is an informal communication and an Office Memorandum is a valid communication.
Chidambaram, who was in London on April 10, 2008, snubbed the officer by pointing out the small errors, including spelling mistake in his communication. He directed for adopting non-paper mechanism of informal communication with DoT in controversial spectrum allotment issues.
The officers even apologised to Chidambaram for issuing the Office Memorandum: “In as far as the issuance of the wrong OM (Office Memorandum), in the first instance is concerned, the mistake, though inadvertent, is purely assignable to a lapse on the part of the undersigned. For this lapse, the undersigned is agreeable to bear the consequences of any action — disciplinary or otherwise — which the department may contemplate against him.”
After getting the apology from the officers, Chidambaram directed them to adopt only non-paper mechanism in communicating with DoT. “That apart, the draft note received from DoT was indeed considered by me on 11.03.2008. Thereafter, that file containing the draft note from DoT and the proposed OM was not put up to me. What was considered was only a non-paper given to me by the Minister of Telecommunications on which I had been informed by FS (Finance Secretary) that DEA would send a non-paper containing our views.
“It is in this context that the note for discussion was prepared; a discussion took place; and I had indicated my views on the margin of that note. Logically, this should have been followed by sending a non-paper to the DoT. However, if there was an intention to send a formal OM containing our views on the draft note for cabinet received from DoT, that file should have been put up to me and my signature obtained. I may note that I was in office on 8.4.2008 and 9.4.2008,” Chidambaram wrote from London.
Welcoming Bhushan’s petition, the 2G crusader and Janata Party president Subramanian Swamy, said: “I welcome Prashant’s move and congratulate him for digging more. It would be fine to fight battle with double barrel guns.”