SC frowns on loans against spectrum
The Supreme Court on Wednesday took strong exception to nationalised banks, including State Bank of India (SBI), advancing thousands of crores of rupees to little known telecom companies on the basis of hypothecation of their 2G spectrum licences.
"All transactions between banks and 2G spectrum licence holders must come under the scanner immediately," said a Bench comprising Justices G S Singhvi and A K Ganguly. Not needing any further push, the CBI said it would entrust the probe to its bank fraud cell and submit a report to the apex court.
When petitioner's counsel Prashant Bhushan pointed out a media report about banks advancing Rs 11,000 crore to telecom companies solely on the basis of hypothecation of their spectrum licences, the Bench said, "The figures of the loans advanced appear to be very very substantial."
It added, "State Bank of India, the most premier bank functioning under an Act of Parliament, has advanced over Rs 8,000 crore. This shows the dimensions of the scam."
As per the reports cited by Bhushan, Unitech got a total loan of Rs 10,000 crore of which SBI alone disbursed Rs 8,050 crore. The report quoting Registrar of Companies said Unitech had got loans worth Rs 500 crore each from Corporation Bank and Allahabad Bank, Rs 400 crore from South Indian Bank, Rs 120 crore each from Canara Bank and Punjab National Bank, Rs 100 crore from Standard Chartered Bank and Rs 70 crore each from Oriental Bank, Central Bank of India and Yes Bank.
Taking exception to the basis for advancing of loans, which was a tripartite agreement with Department of Telecom a party, the Bench said, "It appears as if the nationalised banks were giving just Rs 100 or Rs 200 and did not need any security of the loan advanced."
"All transactions between banks and 2G spectrum licence holders must come under the scanner immediately," said a Bench comprising Justices G S Singhvi and A K Ganguly. Not needing any further push, the CBI said it would entrust the probe to its bank fraud cell and submit a report to the apex court.
When petitioner's counsel Prashant Bhushan pointed out a media report about banks advancing Rs 11,000 crore to telecom companies solely on the basis of hypothecation of their spectrum licences, the Bench said, "The figures of the loans advanced appear to be very very substantial."
It added, "State Bank of India, the most premier bank functioning under an Act of Parliament, has advanced over Rs 8,000 crore. This shows the dimensions of the scam."
As per the reports cited by Bhushan, Unitech got a total loan of Rs 10,000 crore of which SBI alone disbursed Rs 8,050 crore. The report quoting Registrar of Companies said Unitech had got loans worth Rs 500 crore each from Corporation Bank and Allahabad Bank, Rs 400 crore from South Indian Bank, Rs 120 crore each from Canara Bank and Punjab National Bank, Rs 100 crore from Standard Chartered Bank and Rs 70 crore each from Oriental Bank, Central Bank of India and Yes Bank.
Taking exception to the basis for advancing of loans, which was a tripartite agreement with Department of Telecom a party, the Bench said, "It appears as if the nationalised banks were giving just Rs 100 or Rs 200 and did not need any security of the loan advanced."
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Andimuthu Raja, right, looks on as the Central Bureau of Investigation searches his home in New Delhi. Raja was forced to resign as telecom minister over corruption charges.
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