The ongoing 2G scam probe got elongated further with the Enforcement Directorate (ED) issuing show-causes notices to a clutch of telecom firms and other entities for allegedly foreign exchange violations worth Rs 3,805 crore. The notices by the central probe agency have been issued against Loop Telecom (Rs 549 crore) Loop Mobile India (Rs 26 crore) DB Realty (Rs 2,831 crore) and ETA Star Property Developers (Rs 399.50 crore) for a variety of alleged contraventions under the Foreign Exchange Management Act (Fema).
The ED has been probing financial transactions and role of these firms in the 2G spectrum case for sometime and the agency issued Wednesday notices after going through all the "evidence on record" and information received from these respective firms. The notices sent to these companies have cited various charges of violation of RBI guidelines in place for receipt of FDI and routing of funds to and from foreign shores. Loop Telecom, Delhi and Loop Mobile, Mumbai have been show caused for alleged violation of Fema rules with regard to their "failure to report to the RBI the receipt of FDI and issue of shares to foreign investors." Real estate firm DB Realty Mumbai has also been charged on the same grounds which is a violation under section 6 of the Fema.
The Chennai-based construction firm ETA Star Property has been charged by the agency for "failure to issue shares against FDI within 180 days and to report to RBI the issue of shares to foreign investors". The ED, alongside CBI, has been probing money laundering and forex violation instances against the firms involved in the 2G case and has earlier issued similar notices to the tune of Rs 2,000 crore in the same case against various other firms. The show-cause notices can be challenged by the firms in the appellate authority of the Fema which acts as a quasi-judicial court.
