Swan Telecom director Vinod Goenka, Unitech Wireless (Tamil Nadu) managing director Sanjay Chandra, and three top officials of Reliance ADAG Gautam Doshi, Surendra Pipara and Hari Nair taken to Tihar Jail after Special Court concurs with CBI that they could hinder the smooth progress of investigations
A special court today denied bail to five corporate executives named in the case involving the allocation of second generation (2G) telecom spectrum during the tenure of former communications minister A Raja.
Judge OP Saini dismissed the bail petitions of Vinod Goenka, director, Swan Telecom, Sanjay Chandra, managing director, Unitech Wireless (Tamil Nadu), and Gautam Doshi, Hari Nair and Surendra Pipara, all three officials of the Reliance Anil Dhirubhani Ambani Group.
The five officials were taken to Tihar jail following the court decision in the afternoon. It was reported later in the day that their lawyers have petitioned the Delhi High Court seeking bail and that these petitions were likely to be taken up on Thursday.
They had all been named by the Central Bureau of Investigation (CBI) as co-accused along with Mr Raja, his personal assistant RK Chandolia, former telecom secretary Siddhartha Behura and Swan Telecom promoter Shahid Balwa, who are already in judicial custody.
They are charged with manipulating the grant of telecom licences and radio airwaves in 2007-08 that, according to the chief government auditor, could have caused the state exchequer a presumptive loss in revenues of Rs1.76 lakh crore.
"All the bail applications have been rejected," judge Saini said. Subsequent to the rejection of the bail pleas, the five executives even petitioned the court for interim bail for seven days, which was also turned down.
"The accused will be sent to jail," a CBI official said. A lawyer for the investigative agency said the executives would remain in jail until a higher court granted them bail.
The shares of the telecom firms slipped following the court order. Shares in Unitech fell 5%, DB Realty fell 4.2% and Reliance Communications was down 2% while the main stock index closed up 1.84% and an otherwise positive trading day.
The court did not allow the bail plea of Surendra Pipara, even though he is said to be ailing and the Special Public Prosecutor UU Lalit did not oppose the application. In fact, the judge had reserved his order after hearing the arguments of all sides on Friday and asked the company officials to remain present during the proceedings today.
On Friday, pleading before the court to take the five executives into custody, Mr Lalit said, "Considering the matter on record, complicity of the accused in the crime is clearly made out. The act complained of and offences alleged are serious, having made deep inroads in public interest and financial affairs of the state."
"The accused are holding high positions and now that the names of witnesses are disclosed, some of whom are directly working under/or amenable to their directions, the possibility of winning over and/or influencing the witnesses is clearly there," the prosecutor said, while opposing the bail petitions. The CBI also feared that the accused may abscond and that may hinder the smooth progress of the trial.
Senior advocates KTS Tulsi, Mukul Rohatgi and Ranjit Kumar, arguing for the corporate executives, had said that the arrest of the accused was not required during the probe and sending them to jail now would amount to a "travesty of justice" and was an "astounding proposition" of law.
Meanwhile, Norway's Telenor said today that it has requested Sanjay Chandra, the chairman of its India joint venture, to step down from his post, following the charges against him in the telecom licensing scandal. Telenor, which owns a controlling stake in Unitech Wireless, said in a statement that it had asked Unitech to name a replacement for Mr Chandra for as long as the 2G case is going on in India.
Mr Chandra is managing director of Unitech Ltd, which is Telenor's partner in the India mobile joint venture Unitech Wireless.
The market took support around the level suggested yesterday (5,770 on the Nifty) and rebounded on higher volumes. Expect a couple of days of rally
Pinning its hopes on the government's forecast of a normal monsoon this year and taking a cue from early gains in the Asian markets, the Indian bourses, too, opened higher. The Sensex added 122 points to its previous close, to resume trade at 19,274, and the Nifty gained 45 points to open at 5,786. Banking, IT, capital goods and metals sectors helped the indices notch early gains.
The indices were range-bound in the morning session, but profit-booking led the indices to the day's lows at around 1.10pm. At their intra-day lows, the Sensex was at 19,171 and the Nifty stood at 5,760. But taking support from positive earnings reports announced by corporates during the day, and inflows from institutional investors, the market was on a higher trajectory and closed near the day's high.
At the intra-day high, the Sensex was up 363 points at 19,485 and the Nifty gained 116 points at 5,857. The market closed marginally below these levels, the Sensex settling at 19,471 with a gain of 349 points, and the Nifty closing 111 points up at 5,852, suggesting the gains could continue for a day or two. The advance-decline ratio on the National Stock Exchange was 1027:377.
Though the broader indices also closed positive, they underperformed the Sensex. The BSE Mid-cap index gained 1.18% and the BSE Small-cap index advanced 1.29%.
BSE Auto (up 2.72%), BSE IT (up 2.39%), BSE Metal (up 2.32%), BSE Consumer Durables (up 1.99%) and BSE TECk (up 1.95%) were the top sectoral gainers. There were no losers today.
Mahindra & Mahindra (up 5.05%), TCS (up 4.63%), Hindalco Industries (up 4.16%), Tata Motors (up 3.99%) and Jaiprakash Associates (up 3.92%) were the top performers on the Sensex. On the other hand, Reliance Communications (down 1.99%), Hero Honda (down 1.87%) and Larsen & Toubro (down 0.04%) ended losers.
Stepping up its probe into the dealings of suspected money launderer Hassan Ali Khan, the Enforcement Directorate (ED) has approached the ministry of home affairs to find out if he has any links with terror outfits. In a letter to the home ministry, the ED has conveyed that it was absolutely necessary to look into various aspects of the 53-year-old Pune-based stud farm owner's dealings and whether he had any links with any terrorist outfit, whether within the country or abroad.
Markets in Asia ended in the green on indications that despite the downgrade in US credit outlook, the economic recovery is still on track. The markets also factored in the drop in Japanese exports in March following the devastating earthquake and tsunami. Exports fell 2.2% in March, from a year earlier, more than the 1.5% analysts expected. This is the first decline in 16 months.
The Shanghai Composite gained 0.29%, the Hang Seng surged 1.60%, the Jakarta Composite jumped 1.66%, the KLSE Composite climbed 0.62%, the Nikkei 225 advanced 1.76%, the Straits Times rose 1.29%, the Seoul Composite jumped 2.23% and the Taiwan Weighted was up 2.02%.
Back home, institutional investors-both foreign and domestic-were net buyers in the equities segment on Tuesday. Foreign institutional investors bought stocks worth Rs1,693.19 crore and domestic institutional investors pumped in Rs208.33 crore.
Wind energy major Suzlon (up 5.42%) announced that the company has bagged an order from Gujarat State Fertilizers & Chemicals (GSFC) to set up, operate and maintain wind energy projects totalling to 50.4 MW in Gujarat.
The projects, utilising 24 units of Suzlon's S88-2.1MW wind turbine, will be set up in wind farms operated by Suzlon in Rajkot and Surendranagar districts of the state. This is GSFC's fifth order to Suzlon and is scheduled for completion and commissioning by September 2011.
Areva T&D India (up 1.26%) has bagged two electrical balance of plant (eBOP) contracts from Essar Projects (India) for its upcoming power projects at Tori in Jharkhand and Paradip in Orissa. The combined value of both contracts is about Rs290 crore and the scope will include supply and installation of electrical balance of plant solutions for two 600MW thermal power plants at Tori and four 30MW thermal power units at Paradip.
Private sector lender Yes Bank (up 2.18%) plans to raise up to $500 million (about Rs2,000 crore) during the current fiscal to fund business growth. The board has approved to raise funds by way of issuance of equity capital of up to $500 million in one or more tranches, Yes Bank said today.
Net profit in fourth quarter grows 62% to Rs516 crore on lower bad loans provisioning and higher interest income; RM Malla, chairman and managing director, sets 40% growth target for retail deposits
IDBI Bank will continue to increase the corporate loan business, but focus more on the retail segment in 2011-12. Currently, the bank's corporate-to-retail loan ratio stands at 70:30.
"We have engaged with almost top 500 companies in India. We will continue to expand our corporate loan business, but this year (FY2011-12) we will aggressively focus on retail," RM Malla, chairman and managing director, IDBI, said on Tuesday.
Savings and current accounts contribute more than 25% to the bank's funds. "We are targeting around 40% growth in retail deposits," Mr Malla told a news conference called to announce the results.
The bank announced a 62% growth in net profit to Rs516 crore in the quarter ended March 2011 from Rs318 crore in the previous corresponding quarter, mainly due to lower provisioning for bad debts and a rise in interest income. Net profit for the full year 2010-11 grew by 60% to Rs1,650 crore, as against Rs1,031 crore in 2009-10.
IDBI's net interest income in the fourth quarter increased by 45% to Rs1109 crore as against Rs 762 crore in the corresponding quarter of the previous year. Total income of the bank for the quarter rose to Rs 5,701 crore from Rs 4,628 crore in the same period last year.
IDBI's deposits increased to Rs1,80,486 crore in the fourth quarter to March 2011 from Rs1,67,667 crore in the corresponding period a year ago. Advances stood at Rs1,57,098 crore, compared to Rs1,38,202 crore. The bank expects a loan growth of 15% to 18% in the current financial year.
IDBI plans to raise $1 billion in this fiscal through its umbrella medium term note (MTN) programme. The bank had mopped up $350 million through this programme last year.
The state-owned bank also plans to raise $250 million via a bond issue in which global banks and financial institutions will invest. "We will raise $250 million in a bond issue and Asian Development Bank will be a guarantor," Mr Malla said.
The bank's step to waive charges on current and savings account (CASAs) transactions led to an increase in the proportion of CASA in total deposits. "With this step, the share of CASA in the total deposit increased to 20% from 15 %," the chairman said.
The bank opened 284 branches in FY11 and it intends to increase the number of branches this year too. "We have got licences to open 500 branches. We opened 284 branches in FY11. We plan to open more branches," said Pothukuchi Sitaram, chief financial officer, IDBI.