Reliance Telecom, part of Anil Ambani?s ADAG and a 100% subsidiary of Reliance Communications, was on Saturday charge sheeted by the CBI in the 2G spectrum scam. The development is a major setback for the group. Last November, the CAG named the company among the biggest beneficiaries of former telecom minister A Raja?s largesse given in January 2008.

Charging the company as a front for Swan Telecom to get spectrum illegally, the CBI has charge sheeted three officials ? the largest from any single company ? Gautam Doshi, group managing director, Surendra Pipara, senior vice-president and Hari Nair, company secretary. Doshi is one of the three group managing directors of ADAG.

The charge sheet said that investigation revealed that, between January and February 2007, Doshi, Pipara and Nair in furtherance of their common intention to cheat the government created Swan Telecom out of funds arranged from Reliance Telecom, a 100% subsidiary of Reliance Communications, for applying licences in 13 circles where Reliance Telecom had no GSM spectrum.

This is the first time that ADAG has been formally booked for the scam by the investigating agency following questioning of group chairman Anil Ambani and other officials in the past few months.

Apart from ADAG, former telecom minister A Raja, former telecom secretary Siddharth Behura, Raja?s former private secretary RK Chandolia, Unitech managing director Sanjay Chandra, Swan Telecom promoter Shahid Usman Balwa and DB Realty?s director Vinod Goenka have also been charge sheeted.

The charges levelled against these are of cheating, forgery, criminal conspiracy and corruption. The CBI said that investigation into issuance of new Unified Access Services Licences and subsequent allocation of 2G spectrum during 2008-09 has established commission of offences under Indian Penal Code and the Prevention of Corruption Act.

This is the first charge sheet filed by the company with the second one, containing names of more corporate executives, expected to be filed on April 25. In the voluminous charge sheet, 654 documents and names of 125 witnesses have been mentioned.

The CBI charge sheet pegged the loss to the exchequer from the 2G spectrum scam at R30,984 crore.

Specific to ADAG officials, the charge sheet has said, ?Doshi, Nair and Pipara of Reliance ADA Group on receipt of approval of allocation of dual technology spectrum to Reliance Communications knowingly did not withdraw their fraudulent application for UAS licence and in conspiracy with accused Balwa and Goenka transferred the management and control of Swan to them, thereby intentionally aiding and facilitating accused Balwa and Goenka to get UAS licences for Swan despite full knowledge that the company was ineligible on the date of application as it was in violation of Clause 8 of the UASL guidelines dated 14.12.2005.?

These offences committed during 2007-08 are punishable under Sections 120-B, 420, 468, 471 of the Indian Penal Code and 13(2) and 13 (1)(d) of Prevention of Corruption Act against the accused. The Reliance group officials are charged with Section 109 read with Section 420 for offer of bribe to public servant (Section 109) and cheating (Section 420). The charge sheet running into about 80,000 pages was filed before Judge O P Saini in the special court constituted exclusively to try the case. Special Judge O P Saini took cognizance of the CBI charge sheet and issued summons for April 13 against the accused not arrested in the case. The CBI charge sheet clearly establishes that the agency?s investigation is along the lines of the CAG report. The main charge, according to CAG against ADAG?s Reliance Telecom (100% subsidiary of RCom) was that it used Swan Telecom as its front to get spectrum illegally. It had said that since Swan applied for licences in similar circles where RCom had services, it was a clear breach of the cross-holding norm, which bars a telecom company from having more than 10% stake in another telecom company in the same circle. RTL?s stake in Swan was 10.71% at the time of applying for licence, however later the company exited from Swan. Sanjay Chandra?s Unitech and Shahid Balwa?s Swan have also been identified as the biggest beneficiaries of the scam.