The Supreme Court’s decision to uphold Delhi high court’s order validating external audits of private telecom companies by the Comptroller and Auditor General of India (CAG) is an important and necessary step to curb corruption in this sector. A commendable ruling by the bench comprising Justices KS Radhakrishnan and Vikramjit Sen, the order paves the way for considerable lessening of the staggering losses to the government exchequer, either through underpriced and non-transparent auctions of spectra to these private telcos, or by non-recovery of enormous loans handed down to these corporate entities by public sector banks. Inasmuch as telecom in India still remains the hotbed of fraudulence, with 2G spectrum scam synonymous with big league corruption causing losses to the tune of Rs 1.7 lakh crore in government revenues through rigged auctions, external auditing, in addition to those undertaken by the department of telecom, is indeed a must, if only to check the ever-growing tendency of the companies to break or tweak legislations for private profiteering. The firms’ accounts have been, over the years, substantially fattened by public loans, and often, as part of private-public-partnerships, allowed undeserved leniency. Certainly, the telcos have been trying to drive home the absolutely bogus point that because they ‘share’ their revenue with the government and pay the licence fee as part of that revenue, they must be spared external audits, since the amount is calculated only after suitable deliberations by ministerial and departmental audit teams. However, given that elected ministers have been equally part of the corruption nexus that surfaced as the massive 2G scam, evidently, that remains grossly insufficient to address the credibility gap.
There are alarming reports, tabled by CAG and other auditing bodies, which detail how easily let off are the culprits in cases pertaining to the telecom sector filed by the various probing agencies. Incomplete departmental proceedings, pending trials and many other problems plague the system, which are deftly used by the private telcos to notch up undue profits, pinching the government exchequer further. It is estimated that almost $100 billion is still required to truly modernise the telecom sector and turn it into a world-class service industry, cross-linking sectors such as banking, software, airline, manufacturing and others. However, if the companies show fabricated figures and overstate their expenditure levels to obtain massive tax exemptions, what follows is humongous loss as revenue to the government. Given that thousands of crores are still lying as unpaid dues from the five private telcos, it is, therefore, absolutely necessary that private telcos show their balance sheet to the only auditory body that still has a shred of credibility left with it, in other words, the CAG. This is evidently in keeping with the wider ambition of bringing errant private sector companies under the CAG scanner, including the power discoms and mining companies.
There are alarming reports, tabled by CAG and other auditing bodies, which detail how easily let off are the culprits in cases pertaining to the telecom sector filed by the various probing agencies. Incomplete departmental proceedings, pending trials and many other problems plague the system, which are deftly used by the private telcos to notch up undue profits, pinching the government exchequer further. It is estimated that almost $100 billion is still required to truly modernise the telecom sector and turn it into a world-class service industry, cross-linking sectors such as banking, software, airline, manufacturing and others. However, if the companies show fabricated figures and overstate their expenditure levels to obtain massive tax exemptions, what follows is humongous loss as revenue to the government. Given that thousands of crores are still lying as unpaid dues from the five private telcos, it is, therefore, absolutely necessary that private telcos show their balance sheet to the only auditory body that still has a shred of credibility left with it, in other words, the CAG. This is evidently in keeping with the wider ambition of bringing errant private sector companies under the CAG scanner, including the power discoms and mining companies.