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Old 30th Aug 2011, 17:41   #1 (permalink)
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Join Date: Feb 2011
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More trouble anticipated for Spice Jet

2G spectrum scam fallout: ED to attach Kalaignar TV, Etisalat assets in a month under prevention of Money Laundering Act - Economic Times

2G spectrum scam fallout: ED to attach Kalaignar TV, Etisalat assets in a month under prevention of Money Laundering Act

NEW DELHI: The Enforcement Directorate has told the Supreme Court that it plans to attach properties of DMK-controlled Kalaignar TV under the Prevention of Money Laundering Act in a month.

This is for the Rs.200 crore Swan Telecom allegedly paid it as quid pro quo for 2G spectrum allotted to the teleco by the then telecom minister A Raja. The ED also told the court that it will complete attachment of assets of Etisalat DB (formerly Swan) for alleged violations of foreign direct investment norms.

Senior counsel KK Venugopal presented a fresh status report on ED investigations in the 2G scam to a bench comprising Justice GS Singhvi and Justice AK Ganguly. Foreign Exchange Management Act violation complaints against DB group, Virgin Mobile, Milky Way Developers and ETA Star group have also been noticed in its preliminary inquiry, the ED counsel said.

Reading out part of ED's report, Venugopal said there was Fema violation totaling Rs.2,100 crore in the four cases. According to ED official, the four companies had brought in foreign investments without complying with mandatory requirement of prior intimation of the Reserve Bank of India.

Venugopal said that ED will start attaching properties after filing chargesheets in the 2G spectrum scam case. Under the Prevention of Money Laundering Act, or PMLA, the attachment proceedings were independent of the trial. Adjudication and confiscation of properties could take place even during pendency of the trial.

"If the accused is acquitted by the trial court in the 2G spectrum scam, then the decision to attach and confiscate properties of the accused can be reversed," said Venugopal.

ED sources said PMLA proceedings would focus on recovering the money allegedly paid to A Raja and his associates in foreign countries as illegal gratification as a quid pro quo for spectrum favour and later brought into the country for acquiring real estate or shares in companies.

In the Kalaignar TV case, CBI had filed a supplementary chargesheet, naming DMK MP Kanimozhi and channel managing director Sharad Kumar for payment of Rs.214 crore to it by Cineyug with the money trail leading up to Shahid Balwa-promoted DB group. Both are languishing in capital's Tihar jail in connection with the case.

Venugopal also told the court that ED has issued show-cause notice amounting to Rs.7,100 crore under Foreign Exchange Management Act to Etisalat DB Telecom for alleged violations of FDI norms in the telecom sector.
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