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I" , .' ".Fil, No.20-82/2lJlJ7-AS_1 Lvo--~.j~:-.....

Department ofTcJccommunicaHonS--

(AS-.I Section)

.subject: 14 Applications ofMI.il;. S,,;an Telecom Pvt. Ltd. for gr.ant of VASt in

Andhr}l Pradesh, 'Delhi, (;ujaral, H11ryana, J&K, Karnatal<a, Kerala,

Mahara.shtra, Mumbai, Punjab, Rajasthan, TamiJnadu, Uttar Pradc~h

(East) & LIUar Pr.::JdesJI(West) service areas and 2 applications of Mis.

Cheetah Corporate.~ Sen-ices Pvt. Ltd. for grant of UAS Licences inAssam & North-East service areas .

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3. Further, Oll 2,3.07, two Jl)ore applications were filed by Mis. Swan Telecom .is

PVl. Ltd. for Assam & North-East service a~~as (19-20/c).J-lO\Vever,. yi.cI.e-J.e,l.~'f~j~I;.;.. ',"

daled 6.3.07. the company TeQl)ested for wIthdrawal of these two <lppJ1CCltJiJJlS ror"'~~~':,:,,_ ~»~1Ass<lJll & North East service a r e ..1 s (22/c).

.I\n app/ic;.J[illns dalcd 23.01.07 was received from M Is. Swanc.1pitaLl~~.J.,,,,,. __~_

'\ ;s/!)./ Lid.. ]''' Flnor. H~,hC'jaPoint-L JLN Milrg. Vilko/lJ Mkl.. Stl/lta C'nu( Easo, jVllil1lb3i~':" 'f :- '-

\ --.?/ <./O()055. t < ) r gralll of IJnil ierl Access Sl'rvice LicI.:Jll't: f ix . I&K service an.',] 1 1 1 . f . " ) . In~~y . wnlinualion. the company. vide iell", dared 1.2.07 & :28.2.07 h", finnished .'ome

- P q """, information regarding cqoily stfUelure. cle. (J.4/c). The w ,o ram. 'n ,h"

~\ " \ "'e'""whiic-. ,ide. leller d'' 'cd 6.3JI7. i"I,,,n,ed Ihe change of name of the comrane

' ), \' fro", 'MI, ..')lVil" C"pil"i P\'1.I.rd:'I~~MI.,. Swon Telecom p'.l. LId.'. (2.Ve).

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. -. Suhsequently, onf~ M is. Swan l 'clcCI)l11 1'''1. Ltd. slIbmincd l:l m\1re

c , " ' > applications li)r gralll of UAS Licences lor Andh •.• Pradesh .• Delhi. Gojaral. 'g

0- ';f Haryana, Karnmah. Kerala. Maharashlra, Mumbai. Punjab, Hajasthan. T am illlC id u. 1

. Ullar Prudesh rEast) & Utlar Pradesh (West) service areas {S•.I7/,!.

4. Subsequemly, u n 7.3.0 7. MIs. Cheetah Corpormes Services PVI. Ltd.- a

."isfcr concern of Mis. Sw:m .reJecom Pvt. Ltd .•th Floor. l{aheja Point-I .. JL\i

M<1rg,Vako/a Mkl., Santa Cruz(Easl),Mumbni-400055,

h!:lssubmiut:d applicati{llls

for UAS Licence for Assam & North Easl service lIreas (26-271c).

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Subject:

File No.20-8212007-AS-J

Departmr.nt ofTelI'.cnmmunicatjons

(AS-J Sr.ction)

'1 4 UASL Applications of MIs. Swan Telecom Pvt. Ltd. (Formeely

MIs S••an Capital Pvt. Ltd.) for grant of UAS Licenc" in Andbra

Pradesh, Gujarnt, Hu.ryaDR,Jammu & Kashmir, Kam8t:1.ka~Kera'a,

Mab ••• sbtra, Punjab, Rajnsthan, Tamil Nadu, Uttar Pradcsb(East),Uttar Pndesh(West), Delbi and Mumbai service areas." .,.

I. Mis. Swan Telecom Pvt. Ltd. (F.ormerly Mis Swan Capital Pvt. Ltd.) has

applied for grant of Unified Access Services Licence in Jammu & -Kashmir service

area. The APplication of Swan Capital Pvt. Ltd. in original is placed at lIC and

. i numbered from I-I/e to 1.55/C.

2. The company has applied in the prescribed format and has enclosed a

processing fee of Rs.15,OOO/-. The processing fee had been forwarded to Pay &

Accounts Ofticer, HQ, DOT as per details .vailable at 56/C. Subsequently, on 10

February 20.07 the company has furnished further infonnation regarding compliance

"CsubStantial equity clause. On 2nd M.'ch 2007, tbe company further provided

supplementary information regard~ngliSshare holding pattern etc. which is placed at

6(J-15/C. Again the company submitted a lener dated 6'" March 2007 informingchange of name of the company along with copy of fresh certificate of incorporation

issued bv registrar of companies which is placed al 75.78/C.

jO 'l~ \ 1 ) , . . , . " "3 I The company has also submitted fresh appli"cations for 13 more service areas

on~a Febroarv-:lZ007 and two more service areas on 2" d March 2007. Thus. the total

number of applications for grant ofUAS License sub!J1ittedby the company is 16 i.e.

the company bas applied for 16 Service are.s namely Andhra, Pradesh, Assam,

GujaraL Haryana, Jammu & Kasljrnir, Karnataka, Kerala, Nortb East, Maharashtra,

Punjab. Rajastban, Tamil Nadll, Unar Pradesh(East), Uttar Pradesh(West), Delhi and

Jv!umbai service areas.

4. The processing fee for the above 13+2 applications were also sent to PAD vide

liners at 79-86/C. Subsequently, on 61 1 J March 2007 the company submitted a request

for withdrawal of twO applications against Assam and North East service areas 87-

92/C

5 Similar applications for other service areas have been submitted by the

company in the name of MIs. Swan Telecom Pvt. Ltd. vide their application dated

2.2.2007 and 2.3.2007. As mentioned above. the company has withdrawn rwo

applications against Assam and North East service areas. Thus. as on date there are

only 14 applications for grant of UASL in Andhra Pr~~~e~h,Gujara•• Haryana, Jammu& Kashmir, Karnataka, Kerala, Mabarasiilra.-Piinj~b. RajaSthan, Tatiiil Nadu, Unar

Pradesh(East), Unar Pradesh(West), Delhi and Mumbai service areas.

6. For convenience only applications of Jammu & Kashmir service area and

Punjab service area is placed in this file. A preliminary check has been earned out by

Dir(VAS-II)/ ADG(VAS-I) lUldthe repon date.d 06.11.07 submined oy them with

reference 10the above applications for these ::;eryice areas is placed at 116/c of The

check list 1Splaced at 114-115/c.

7. As per the check list, t he total Nctwoir\h required is Rs. 1030 CroTes and the

paidup equity capital required is Rs.l 0 crores.'/According to the details mentioned in

the application of J&K, the paid up equity of the company is 3.03 crores (SIC),

however, as per the certificate enclosed at 38/C, the same is RS.3.29 croTes. The

certificate does 001 bear any date. It is further to mention that as per application for

Punjab and other service areas, the paid up equity capital is Rs.ll 0 crores. The

.certificate enclosed with the Punjab appl icitiO"i1 also does' not 'bear' :my date. As

rcgards nerworth of the company is concerned, the same is Rs.30.96 crores as on

23.1.2007 according to the certificate of Chartered Account submittr.d with J&K

application, however, ihe same is RS.l JOO.28 crores as on 2nd

~.~cb..2007 according ito certificate attached with applicarion for Punjab service area.--lt is to be mentionedl-~-- -.;"j

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.~; Reference note on pre-page at 17-19/N

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File No 2o-82/2007-AS-I

I. 14 UASL application were received from Mis. Swan Telecom Pvt. Ltd.

(Fonnerly Mis Swan Capital Pvt. Ltd.) for Andhra Pradesh, Gujarat, Haryana, Jammu& Kashmir, Karnataka, Kerala, Maharashtra, Punjab, Rajasthan, Tamil Nadu, Uttar

Pradesh(East), Uttar Pllldesh(West), Delhi and .Mumbai service areas. These

applications have been examined as per the check list at 114-115/c. Observations at

p::lIra 5 &Band 2-3/N are relevant & may kindly be seen.

2 As per existing practice for granl of new UAS licences, after preliminary

examinations of applications, as on date of Applications, required clarifications!

co.mpliancesi certificates ~ere obtained from the cornpany before issue afLoI so far.

However, in certain cases the compliances have bet'.n considered at a date before issue

ofLoI. based on clarification sought and for seeking updated information. .

21 However, as per.para 6 on 6-7/N in file No. 20-100/2007- AS-I (Part-C), these

required clarificationS! compliances! cenificatf",s shall now be obtained alongwith

compliance to LOJ conditions which will be further examined. It is proposed that aclause be put in the draft LOI thai the Government reserves the right 10 cancel /

withdraw LoI(s) or licence agreement(s), ifsigned, in case it is noticed at a laler date

that the applic:mt company was not eligible as per the criterion for grant of UAS

licence. The applicant company shalt be fully f('-spoflsible for any eventuality arising-

out of non-compliance. at any time. The non.refundahle entry fee if deposited shall b~

forfeited and PBG, FBG may be encashed and forfeited also in such cases. Further, the

company is required to submit a certificale of Company Secretary certifying that the

company agrees that the LOI shall he deemed to be '¥ithdrawn/ Licence agreement (if

signed) shall be deemed to be terntinated without assigning any reason and PBG, FBG

shall be encashed and forfeited forthwith, in case of submission of false certificate or

in the event of the Yiolation of any stipulation o r th e 1 " ,0 1by the company.

3. The service area wise senioritybased on the date of application of the company

is indicated in the list at 117/c.

4 The case was sent for furtherexamination of LF and JP Wings. JP Cell at 4/N

has noled Ihal the statement at Sex) and 8(xiv) is not correct. Preference shares are not

counted for calculation of FDI and are treated Ilt debt. Hence equity of M Is. RTL

wt,uld bQ 9.871 '1"0 only. The Il.pJjllcatioh ia old, hence we may ask compliance of

amended licence conditions which includes Pres~ 'Note 3 (2007) and equity structure

in tenns Press Note 3(2007). LF may also please ,een. At 4!N, the Dir(LF-lJI) has

noted that •• deficiency have been listed on 3/N. however whether prefe:-ence shares

can be included in the equity holding disqualify a.••in clause 8(xiv) on 3/N needs to be

examined_ Whelher networth can include such items as listed in the details given by

the company also needs 10be examined. DDG(LF) has noted that Ihe wailing detailsl

information may be called for. Moreover, as per discussion with DDC.J(AS), the

depanment is in receipt of 8communication from an advocale of High Court who has

brought out the issue of cross holdings of Tiger Traders Pvt. Ltd., promoters of SwanTelecom. The relevance of the issues raised need io be examined, if required with

inputs from Department of Company Affairs. This is suggested to avoid awkward

situation., ifany_ from arising in fu!Ure. copy of the communication is placed in file.

r " s _ It is separately menlioned at 59/C that MIs. Reliance Telecom Ltd. (RTL) is

; 100% owned by MIs. Reliance Conununicatinfls Ltd. (RCL). Jt has been broughl to

.:..;" \ the notice of this office that there is cross holding of equity among ..the shareholders of

IMis. Swan Capital Pvt. Ltd. ( now Swan Telecom Pvt. Ltd.) and it has been alleged

~hat the substanlial equity clause may be compromised. The company is to chflrif).'.

6 The above observations may kindly be seen and the matter for issue of LoI(s),

m order of priorily in each service area as inrlicated in the list at ]J 7/c. is to be

decided_

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Applications dated 23.01.2007 for Jammu & Kaslunir SerVice Area and02.03.2007 for 13 (Thineen) Service Areas of Andhra Prade~ Delhi, Gujaral,

Haryana,J(8ma"tiika:-k-ei1tla, Maharashtra, Mumbai, Punjab, Rajasthan, Tamil Nadu,

Unar Pradesh (East) and UUar Pradesh (West) submitted by MIs Swan Telecom

(Formerly Capibl) Pvt. LId. for grant of VAS Licence have been scrutinized as per

the guidelines for the Unified Access SCrvlce l..icence dated 14.12.2005. Remarks of

the LF branch relating to financial conditiong ar.: mentioned below:

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Notes on pages 2IN to 7/N may kindly be seen.

File No. 26-S212007-AS-j

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I. Paid u p equity as on date of app!icatifln os certified by the Company

Secretary (Annexure C, 48/c) is RS.I09.0J crores against the required paid

up equity of RS.103.00 crores for 14 (fourteen) Telecom Service AreaS.

Original certificate of the Company Secretary is attached with the

application.

2. Networth of the company as on 02.03.2007 is RS.llOO.28 crores againstthe requirement of Ra.1030.00 crores for 14 (fourteen) Telecom Service

Areas. Original certificate of the chartered Accountant of the

Company is attathed with the application. (49/c). However latest details

of Networth as on 3l.09.2007 of the company and its promoters are

required.

3. Co mpany is 100 % I ndian. C enificate given by the Company Secretary is

placed at page 47/c (ArJllexure B ofapplic3tion).

4. With reference to para? ,8...3..'of the nme of AS Branch, in case the. LOI is

10 be given without first ascertaining that the application is complete in all

respects and that the applicant meets all the eligibility criteria, it is likely

that there may be some appHcl1nts who are not eligible (')t whose

applications are not complete in all respects also reCeive an LOL Since. asrecorded at 6 IN. the entry fee is non~refundable and the PBG. FBG will

be encashed -i f the applicant is found to he ineligible later. it is important 10

apprise the applicani clearly ofsuc.h an eventuality.

To ensure this, the following clauses may he "deled to the LOI:

(A t! (~ The. entry fee is non.refundablc. T n case it is found that the applicant is

nm eligible for the UAS License, the paid entry fee shall be forfeited. In

case the applicant is found to be ineligible on the date of the application~

and subsequently (but before the signing of license) achieves compliance

with ihe LOI/UAS License conditions, the date of priority will be the date

•.m which he become:::: eligible. The applicant must accept this date O t : "

withdraw his appJicr.:tion. Withdrawnl of application shall result in

forfeiture of the paid entry fee and encashmem and forfeiture of thesubmitted PBG and FBG.

(b) The au1honzed signatory, empowered by Power of Attorney from the

company approved by Board Resolution. shall provide a certificate

accepting the condil.lJns mentioned ahove. This. certificalc shall be

coumersigned hy Ihe Company Secretary of the company.

.•. Further, in case the applicant has nOI provided aJJ the documel1ls to prove

compliance with LOfJLicense cnnditions, the applicant should also be

apprised o T all discrepancies! deficiencies in the application. These

di~crcpanciesl deficieides shoulri be communicated as an annex to the

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File No. 20-8212007-AS-1 .

'."m Pre-page

6. However, we would recommend that LOI be granted in the existing legall)' j

vetted format only after all the eligibility conditions are met .and the ;

application is complete in all respects.

SubmiHed please

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DireCior lLF-lJI)

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J v ;NO.20/B2/2007.AS-1 ,

Department of Telecommunications

(AS Division)

Subject: Application(s) for grant 01new UAS Iicence(s),-to s~~T,),.o_ p ., j. cl -- \- , (,

In response to our letter dated 10,12,2007 (!:i3IC), the

applicant company for new UAS licence(s) has submitted the

requisite clarifications! documentsl information ~ 1 :J ..6 'lc). It isrequested that UASL application(s) alongwith all the clarifications!

documentsl information submitted by the company may kindly be

examined for grant of Lol(s). G~~-~ \

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File No.20-8212007-AS-l14 iJ

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File No.20-B2I.007-AS-]

Department of Telecommunications

(AS-I Section)

S!bjecl: 14 Applications of M'S. Swan Telecom Pvt. Ltd. for gr.nt ofUASL

. in Andhra Prade.! ih , Delhi, Gujnrat, Haryana, J&K, Karnataka,

Kerala. Maharasbtra, Mumbai, Pllnjah, Rajasthan, T8miln~du, Uttar

Pradesh (East) & Uttar Pradesh (West) service areas.

Reference notes ~. pre.pages .

.An appliclltion!' dated 23.01.07 was ~ecei"ed from M Is. Swan Capital Pvc

LtG. f,lr ~r3nt of Unified Access Service i~jcencc for J&K service area (lIe).

~uhscq\lcnlly" on l~r February 2007 rh~ cC'mpany has furnj~h(d further

mfonnation regarding compliance of substantial equity clause (571e). On 2nd

March 2007. the company further provided supplementary information regarding

it~share holding pattern etc. which is placed at 60-75/C. Again the company

suPmitted a lener daled 611 t

Mar ch 200 7 in forming ch an ge of name o f the

cdmpany along with copy of fresh certificate of incorporation iSS1!ed by registrarof;companies which is placed at 75-78/C.

2. ; Subsequently, on 23:07, Mis. Swan Telecom Pvt. Ltd. submitted 13 more

artPlicotions for grant of UAS Licences for Andhra Pradesh, Delhi, Gujarnt,

Hhryana, Kamataka, Kernla, Maharashtra. Mumbai, Punjab, Rajasthan,

T.milnadlt. Uttar Pradesh (East) & Uttar Pradesh (West) service ar"as (5-17/c).

,

3.: Further, on 2.3.(17. two more applications were filed by M is. Swan

rJlec.om PVI. Lid. for Assam & North-East service areas (l9-20!c). However.

vide- (eHer dated 6.3.07, the company requested for withdrawal of ihese two

applications for Assam & North East service Rreas (87-92/c).,

4.' Thus. the total numberof2pplications for granl ofUAS: License submitted

by ' the company are ]4 i.e. the company has applied fot J 6 Service areas na.melyAndhra Pradesh, OuJaral. Hary"na, Jammll & Kashmir, Karnataka, Kerala,

Mahara~htra. Punjab, Rajasthan, Tamil' Ni1lJu. Uttar Pradesh(EflSl), Uttar

Pradesh(Wesl). Delhi and Mumbai service are < 1 5.

5.. A processing fee of RS.I5.000/- for each service areas have also been

futnished by the company an'd the same had heen forwarded to Pay &Account:;

Officer, HQ, DOT on 27.08.2007 .

6. Vide. Jetter dated 7.12.2007. the company has intimated regarding change

in sharelh)lding pattern ;f t ' l i e company (126!<:'i.

7. A~ m en tio n i n para 5 of 6/N. vide letter dated 8.] ],2007 (] ]R/c), i.e.

before the recent change in the equity structure of the company. it was brought to

(h~ nOlice of this office that there is cross holding of equity among the

shheholders of M!s. Swan Telecom Pvt. Ltd. and it was alleged th::u the

sn~Sfantial equity clause may be (om promised (l18/c).

8 . 1 The applications were examined vide notes on I-11IN the sarnc may

ki*dlY be perused please. Vide 'A' on lOIN, DDG(LF) desired to know the share

holders Mis Tiger Traders Pvt. Ltd. and its parent company. However, based on

th_ decision io F. No.20-63/2006-AS-[ (1221c) and I'. No.20-100/2007-I\S-1 (Part

'C') (l23!<:) :mcl in view of c\\ange of sharcholdiug of the company 026/c),

the cornpnny, viele our !ener datelf 1O.12..20()7 (I 25ic), was asked to submit

.:!ariiicatlons! infonnation! supporti;Jg docllmcnis. Vide letter dated 13.12.2007

(12~/c), the. company has submitted the n::quisitc clarifications! informati:m..'~upporting documents.

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File No.20-8212007'AS'l.,(- ,

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.':). Ora"1l of LoIs and. SigRiRQ )fI jCepce 'B",Bmem shall be considered in.the

.,;,~e; 0 : - priority as per the list at 117fc in each service area after the applicant

,:v:y,pany is found eligible for grant ofUASL as per I~eeligibility condition.

f . " , '>'\~f;J;~~/ (1:; / -

:)ervice area wise list of pending UASL applications (aJongwith date of

a!..:;.,t;c;:.:'.ion)is placed at 117/c may kindly be perused for existing policy of first-

corn,:~-firsl-serve basis in each service area

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12 We may reques.t LF! IP Wings to further examine the case w.r.t. to

eligibility conditions such as Networth, Equity, Substantial Equity and -FD1/

Foreign Collaboration. . ~

iM~dan Chaura.c:;ia)

S.O.(AS.])

17.12.2007

D U ~ 0 s = n /

!O. Accordingly, a preliminary check has been carried out by DIR(V

I,\S-

II)/ADG(VAS-I) and has enclosed a check list at I29/c. Some of the important

observations have been made as below. .

'i-', ~lame & designation of the person who has signed the documents has 'not

'leen mentioned at all places, wherever signe.:.. Certificate of true copy:not

:nenlioned on relevant places.

"T1le company has intimated that C E O i C F O i C S O /C TO htlVe not been

FlPPOlmed as yet.

;'lii. r"onn 32 for all Directors has not been submitted.

rhe ~ompany has mentioned that Business Plan was submitted along with

applications_

TIle c.ompany ha:: menlioned that document was submit!c(\ along with

appJication(s), however, certified copy nOt enclosed with reply dated

12 1'.2007.

{vi \ Most of the documents have been shown dated 13.12.2007 whereasforwarding letter is dated 12.12.2007

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File No. ZO.82i2fl07-AS-I

From pre-page:

In continuation to notes on pre.p.\ges following has been observed:

1. Pain up equity o f M Is Swan Telecom P,'t. Ltd, as on dale of application

i.•.23.01.2007 and as on 13.12 ..2007 was RS.I09.01 crores agaimt the required

p"i(\ 11P equity of RS.103.00 crores for 14 (Fourteen) Service ,Areas (P-20 of

128/c) .

2. Netwonh afM/s Swan Telecom p"t. L'!d, and its promoters as on'date of

application i.e.23.01.2007 was 1100.28 croro; and as 00 13.12 ..2007 was

RS.II04.318 crores against the required networth of Rs.1 030.00 crores for all \4

(Fourteen) Service Areas (P-20 & 21 of 128/c).

3. FDI is 9.90% which within 49% for which no FIPB approval is required.

Furthe-r it is also mentioned that initially equity holding pattern of Mis Swan

Telecom Pvt. Ltd. as on 03.05.2006 was as under:

MiS Powarsrfer Interactive (lndin) Pvl. Ltd.

4999 Shares 49.99% of holding

2. MIs Reliance Energy Management Services Private Ltd.. 5000 Share 50.00% of holding

Subsequently it was modified on follC'lwing lines:

2

MIs Tigers Traders Pvt. Ltd.MIs Reliance Telecom Ltd.

90.\ 0 % of holding9.90% of holding

Now < 1 . 5 per details s.Jbmitted on i2.12.2007 the 9.9% ownership of Mis

Reliance Telecom Ltd. has been transferred 10 Delphi Investmcn; Ltd. Thus the

holding pmtcrn has been modified by replacing Mis Reliance Tekcom Ltd. with

Mis Delphi Investment Ltd. a foreign C1)mp~my.

4. The Sh ar e Ho ld in g pattern of T iger Traders Pvt. Ltd. and its p arent

companies has not been provi.1ed in response to our notings at 1 DIN.

5. Mis Swan ~e1ecom Pvt. Ltd. was not having Telecom Services in its

object clause of the M & A of A when the company submitted its documents

along with application on 23.01.2007 and 02.03.2007. Telecom Services t,avc

hcen inserted in the object clauses by Special Resolution at the Extraordinary('jcm:ral Meeting held on 07.02.2007_ which has been approved by the ROC

(111 J 5.02.2007.

Subm itted please.

DireclOrALF-JlI),i

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R. Mahc<.dy men",,,,ed in para 5 nf \ 41N "",1 tIl< ",,,,,ks nf OO(;(.'\S'I, ," t "N. the "biec' cl, ,,se of M&.AI\ of the c"n'p'oy .w" ameoded 10

However. rrnanee

hranch has nol expresseci an,i deci,lc" tl'" ,he

cOlnp,ny me<" the eligihili'y criterioo for paid "1' cQ"ily cap'''l. oet"nr,h

"",1 ,,,hs,,ntial e~uilv as on dOle of applicalion. I\s ' he lina

ncc

braoch (Ll')

w", ceQue,ted '0 ,X'"nn," ;11,0\ ascerlOio Ihe f"lf.tlmeol

of eligihihlY

cnoelilie,ns vidc pa" 8 of t" 'N. ,t,e ,hove oh«rv

" io" 0 " I'n"nc" hran

ch

"",,1,1

he cnnslrued ,Lac ,he cn"'p'O) meelS the e!igihi\it" criterion as o",hing

otherwise has been nbserve,\. fi"ance hranch may coor,on rlc"c.7. \ The ser"iCe areawise priorilY lis' of Ihe ,prlic'tio'" Incntiooe,1 aho

ve

for ,ss"e of LOt' a,,'\ gr.nt of U/IS licences is oS p." 1'" "laced '" 1 \ 7/e.

• •

7. TIle matter h" heen e xamu,ed in d e'~Y LF h r"nch on ,'.5IN. q.

lOiN, 13.151N & IR/N. '.The Finaoee

branch ha> observed on \8/N Ihal "MI" Swaa

Telecom

p",- Ud. has indicated ,ho' 9/).10 % ,,(lhe paid up eq"i'J' eavilal of 109.01

ero

res

was owned by M I,I Tiger' Traders P,'I, Ltd. oad 9 9/)% of ,he paid "I'

equity capitol was held by Mis Reliaace Telecom Ltd. Tlicr< ,,'ere 99.10

Lakhs prefereaee

shores o f joee ,'ol"e Re. Ii.each owned by Mis Reliance

Tele.com Ud ...It was also ohser

vedhy linance branch thai "TI>< ne,,,,ortl, of MIs

Swan Teleealll pvt. Ltd. ",ill, equit}' sl,a" capitol of (Ils. . ! 109.01 Cra,"s.

p,-erereaee share COl'iwl a.f(Rs.! .991 erores, sho,'e pc"",i"fO (on preference

<I,Of"'; of Rs. 99;.00rr erores and" prof!r ofRs. 3..l0r r

e"ores is ;"dica"d a.'

n •. l1n4.31R erare

.'." (Jlher obs"paliOOS also may kindlv

he ,een at 1RIN.

(, \1' "ell h as in dicatel! on ;'1/1" thai "fDI is 9.90% ,,'/Iich i.' Ic.'S , , , , , n

49% and nlin".,,1 ,mdc •. "H,,,mmie """ 'e " , "such the c:o,,,pany" compliaot

10 FO\ requirelTlent.

-1qjN-----

Reference notes al pre. pages. ~An applieatio

odaled 2).01.07 was received from Mis. Swan Capilal

pvt. Ltd .• an Indian company; for grant ofllnifled AcCess Service Licence for

J&K service area (I/c). Sub!rquenlly, on I" February 2007 the cnmpany

furn"h

ed

furlhcr infonnatiO

" regarding coll\pliance of suhslanlial cquily

daus

e

(S7/c). On 2"' March 2007. tbe company further prnvid

e

,!

supplementary inf<>lmation reg"ding ils ,hRle holding pattern ele. 'vhich is

pla,;c<1 a' (,0.75Ie. Ag"n the comp,ny suhn'iued • letter dated 6'" MRleh

20tP re~arding change Df n.me nf the o.omp""y from MI, Swan Capil.

1

pvt

\.I" I" MI, Swan rdccrlln Pv o Ltd aloog with copy of fresh ccrliflcate of

H'Ll'n,o",ti"O ,,,,,cd hv registrar of c",np.nics which is placed at 7S.nic.

2. s"hseQuenlly. 0" 2J.07. Mis. sw.n T<lceom pv\. LIl\. ,,,hlnitt

ed

13

",orc application' for grant of L1I\S Licen'.;es for ",ndhra Pra,lo<h. Ddhi.

Gujar

al

. l1arya

o,. Karo a"k a, Kerala, Maharashlra, Mum

bai

. punjah.

Rajastb

an

, Tamilnadu

, Ullar Pradesh (1'.0>1)& Uttar Pradesh (west) scr

vice

;:l.T eaS (5-\ lIe).: t. Vidc letter dated 7.12.2007, Ihe company has intim'ted regarding

change in sharcholdiog pa'tern of'he company (126/c).

4. The applicatioos were examined vide noles on 1-8/N. Ihe same may

kindly be perused please. Vide' A' on 71N. OOG(LF) desired ID knoW the

share holders Mis. Tiger Trader, pv\. \..I'\' and its palenl companY. However.

based on .the dedsion io F.No.2G-6312006-AS.1 (122ic) and f.No.20.

100120

07

.I\S.1 (Pan 'C') (123lc) aod in view of change of ,h"eholding.o

f

Ihe company (1261C

), tho company. vide our letter dated \0.12.2007 (12S

lc

).

was asked to suhmit

c1",'ilicatiOnsiinfonllaliOniSUpporting dOClI\\,cnts. Vide

letter daled 1 3.\2.20 07 (1 28ic', th e comp an y h as s"h"nll

eci

,be

c1l\riflca\ ionsfinf onnatlllnlsllpportl\lg documents.

5. -" c\leck lis<as per the preliminary check isal \ 29/c and t.F .'1p Wings

were requested IDfurther ,,",ninc the case W.r.\. 10 eligihility cnndiuo

ns

such

as Ne.tworlh. EQuilY, S ,hstaoli,1 Equi'y and FDlIFore

ign

Collaboration. elc.

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R.eference notes at pre-pages.

An application dated 23.0! .07 WRS received from MIs. Swan Capital

PVI. Ltd. for grant of Unified Acce."S Service Licence for J&K service area

(lIe). Subsequently, o n pi FebruClry 2007 the company furnished further

informcllion regarding compliance o r SUb$lantial equity clause (57/c). O n2nd

March 2007, the company further provided supplementary information

regarding its sblfte holding pattern elc, which is placed at 60~75/c. Again the

company submitted a letter dated 61h

March 2007 regarding change of name

of the company along with copy of fresh certificate of incorporalion issuedby r .egistrar of companies which IS placed al 75.78/c_

it

• . . • . • . .r ,

~"'.s L% \ \

P o nle company. "ide rt~ietIer daTed i l4 .0 1 .O S (132/c). has submitted the

requisite ctarification. We may forward the file 10 LF branch to examine and

ascerlsm thl:' fultll1ment of eligibility condilions such as Nelw()fth, Equity.Subsrantlal EquiTY and FD1fForcign CrdlClhoration. etc, in ,•.. jew of lheir nores

::ISmentioned in pam 7 ahove lakmg inro consIderation the reply of theCnrnpClny placed m j'3 2 /c please' Q

.20"'-08=1 m " " j .' " ii ?(Madan Chaurasia

S.O (AS.I)

r-, -\ccordingly. a preliminary check was carried out b.v DIR(VAS-

rJ)/ADGrV,,).S_J1 £Inc ha s enclosed a Cill'ck iisr31 129/c . Aceorr lingly , LF/JP

Wings wer€: requeslerl vide Our notes on 13/N to funher examine the case

'••..r.t. [0 eligibility conditions such (IS J\lC{WOl1h. Equity. SUbsl::.ntj,ll EquilY

and FOl/Foreign Collaboration, etc.

The maller 11M.been examrned in de/ail by LF branch OJ ' 4.S/N. 9.

t O(N. 13-' SIN. As per notes on 15 ..'1\1. rhe cpmpany was f1Sked vid~ our letler

riMed 04. () 1.08 for certain clanfieBlion I,y 07.01.08 (J3I Ie). It wns desired. aI

16/N. fhal rhe file wiH be resubmitted lO U: cell wirh reply of the 3pplicam':-OlTlrtln:--' rarer

S_ The applic31ions wer~ examined vide notes on j -BIN, the same may

kindly be perused please. Vide'A' on 7/N, DDG(LF) desired to know the

share holders MIs. Tiger Traders Pvt. Ltd. and its parent cOmpiln}. HO\l{ever.

based on [he decision in F.No.20-63/2006-AS.j ((22/c) and F.No.20.

1OO/2007-AS-J (Pan 'C') (l23/e) ana in view of change of share-holding of

The company (J26/c), the company. vide our leiter dated 10.12.2007 02S/~).

was asked to submit cJanficationslinf()rmation/supporting documents. Vide

leiter dated 13.12.2007 (128/c). the cornpnny submitted the requisitedari ficatiOllsli nformationfsupporti ng docllmems,

2. SUbseq uently, o n 23.C)7. Ml.'-. Sw:m Telecom Pv!. LId. ,ubmitlcd 13

more .:mpliea!ions ior grant of UAS licences for Andhra f'rIIdesh, Delhi.

Gujl1filL H ar ya na , K ar na ta ka . .Kc ra la , MaharashtrCl, MUl1lhai. Punjab.

Rajasthan. ramilnadu. Uttar PrIHi('~11(F-a~r,: & UUar Pradesh (',Vest) servicearea~ (S-17/e).

A . processing fee of RS.1.5.00{)!. receIved in respect of each service

'!rea~ Wert forwarded to P;'.y & Acc:ounts Officer, HQ. DOT on OL02.07(56!;::) & 0503 07 (96-103/c\

-l Vide kiter daled 7 .12.2007 . the company has inl immed regardingchange III sharcholding pattern of 1he eDlllpany (126/c).

DDG~

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;y File No. ~O_82/2007-i\S,1

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The Networth of Mis Swan Telecom PVI. Ltd. with equity share capital of

109.01 crores. preference ,hare. capital of 0.992 crores. share premium (on

preference shares) of Rs.991.008 crores and a pro"t of Rs.3.308 CTOres is

indicated as Rs.II04.318 crores.

In their clarification datcd 13.12.2007 it was indicated that 90. I0% of paid

equity capital of the company was owned by Mis Tiger Tm"ees PVI. Ltd and

9.90% of the paid up equity capital was owned by MIs Delphi Investments Pvt.

Ltd. Thus 9.90% of the .equity share capital of Mis Reliance Telecom Ltd was

transferred to Mis Delphi investment Pvt. Ltd. Here it ~ be observed that there

is change in holding pattern as intimated by the company~ts clArification

In the recent clarification dated 04.01.2008 ir is stated that the 99.20 Lakh

Preference Shares of Mis Swan Telecom Pvt. Ltd. with face "alue ofRe.l/- each

have been transferred to Mis Dynamix Balwas Infrastructure Pvt. Ltd. These

preference shares hav~ premium of Rs.9991- per preference share and were

esrlier held by Reliance Telecom Ltd. This contributes substantially to the

Nctworth of the company.

Regarding the ownership of Mis Tiger Trustees Pvt. Ltd. it has been

mtimated that the said company is owned by Mis Dynamix Halwas Infrastructure

Pvt. Ltd. Mis Sidharth Consultancy Services Pvt. Ltd. and Mr. Shyam Malpani

jointly with Sidharth Consultancy Services Pvt. Ltd. with share holding of

99.80%.0.19998% and 0.00002% respectively. " , IN " ' -\ r '="- . - " '' '' ' &.clcu,LD < > \

"< ~ .":\~ ~o .> _< ._l"'o 'Jo '.ct .s.,J, "",,,~ d"" 'I ap}6C~"";".""'~l' "I~" original application t-1ls Swan Telecom Pvt. Lid. had indicated

that 90.10% of the paid up equity capita! of 109.01 CTOres 'vos owncd by Mis

Tiger Tradcrs Pvt. Ltd. and 9.90% ,,'-,he paid up equity capilal was held by MisReliance Telecom Ltd. There were 99.20 lakhs preference shares of face value

Re.1! _ each owned by Mis Reliance Telecom Ltd.

The case was earlier examined by us on 14fN to 15fN. AS branch has

asked for clarifications vide l3l/e and there reply dated 04.01.2008 on 132/C our

observations are as follows:

;".'

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Submitted ple~e. ~.~A.O. (Lf-II)

i

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include Iclf:com activily <I." Pflrf of object cI~u!>c on 07-02-2007 qnly. Hence

tilt.: nrr11crl'ion dlllcd 2J-I-2007 for J&K .'\ervicc arc(] docs nof have Iclecl)nl

;'Cliv

il}'/husltlcss in the object clause as on date (Ifapplicfltion. Horvever olher

T:i applications submitred' on 02-03.2il07 CIS in p<lfa 2 :tbovc are cUlllplianf tn'lbjccl c1<lu~ein MAA a:<:.()ndale of applicMjol1.

9 The following is also submitted for considerati(ln please. !(i). In file NO.20-1 OO/2007-AS_T (PaTl-C). il has been dbcided by

Hon'hle MOC&IT on 2.11.2007 that LOis may be issued to the ~pplicanls

(applications) received uplo 25.09..~a07. Subsequently on 4:,12.2007.

Hon'ble MOC&JT desired that this decision should be implemented. It was

also decided that "for tile purpose of LOI proforma ns issued in the pas!may b l" : used ror LOJ~ in lhc~c cases also."

iii) As per para 8 above, one application for J&K serviFC area i~

not c0111pham in respect of object clause. however. I:' applications which

were reccivccl 0n 02.03-2007 i.e. hefore 25.09.2P07 ,p'e in order' and may

he considered for grant o r LOis for UASL rC lr Andhra Pradesh, Delhi.

GUPlrJt. Ht1ryana, Kamataka. Kerala. Mah(]ra~hlra, Mumbai,: !,unjah.

Rajasthan. TamihlCldu. UU<lr Pradesh (East) & Ultnr rrfidesh (West) service

areas. Accorclingly, draft LOis for the above saill service areas .has been

DHemp,ed and placed at DFAtJ,:;!C tol49c for perusal. It is to me/ltion Ihal

the case file for policy regarding gram of 1...01 in the presenl Cases has

already heen submitrerl for decision in a scpar,lte me Nn.20-I00!2007.AS_1

(!'llrt-C). LOis IllflY he issued pllrSll<lnl to aprropri<lte decision in this'T:gilrd.

"

::iii). I\s per the ohservaliom made in p.,ra 7 ;lbove and ion [BIN,

fin(lnce branc.h is also to ensme lnt'll the t'lbove rroro.''ill ;Of grant or LOIs in

1.1 ."crvtce areas is' in (lfdcr w.r.l. eligibility criferion for paid ur equity

\:i1pilal, nctworth ano substnntial equity heforc :lprf(lVtl! of diaft LOisproposed

. (iv) Shri R.K.Gupta, ADG(J,S~I) may he authorized to]si

fn and

,"sue LOis for &on behalfofPresidenl ofJndia. ~)hv-- '_

Submillcd please ~~

~_ DireCtor(AS_I) ~)

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It may be mentioned that Ihere we,e allegation of nou compliance of

substantial equity clause. We have nome.ns to verify that. ipS & ""'- d . - - - - >

C"r'" " ' : > , / J . '< : - < " '. : > ~o-\~ =<2P"-"- oJ'4Submitted please.. ,.'\. /,~~\~. .

AD. (LF-'I)

File No. 20_8212007-As-1

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The case was earlier examined by us on 181N.Based on the available records it is

ohserved !h.t MIs Swan Telecom Pvt. Ltd. have equity share capilal ofRs.109.01

crores arid Networth of Rs.1100.28 crores as on date of ap'p!ication lIS certified by

tbeir Company Secretary. This }!!oujd be sufficient forq (Thirleen

) ServiceAreas. The~'have furnished lhe detailS of their promoters i.e. Mis Tiger Trustees

p,,\. Ltd. (Formerly Tiger ;:raders Pvt. Lt,',.) 11 was observed thaI the details of

M is Tiger Traders Pvt. Ltd one of ,he prom,,!ers of Mis Swan Tdecom p,1. Ltd

a~on date of applicalioh is not submitter\.

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