A day after announcing its exit from the Indian market, UAE-based Etisalat on Thursday said it has moved the court against the promoters of Swan Telecom (Etisalat DB) alleging fraud and misrepresentation.“The Emirates Telecommunications
Corporation-Etisalat has issued proceedings in the Indian courts against Mr. (Shahid) Balwa, Mr. (Vinod) Goenka and Majestic Infracon Pvt Ltd for fraud and misrepresentation,” the global telecom firm said in a statement.
“Etisalat's case is that it was induced into its investment in the company that was then Swan, without any disclosure of the matters that are now alleged by the CBI and Supreme Court to have occurred in connection with the obtaining of 2G licences by EDB. Those events occurred a year before Etisalat's investment,” it said.
It further noted that “Etisalat is facing very significant financial losses on its investment in EDB despite its having no involvement in the 2G licence application or award process and being entirely innocent of any allegations relating to it. Mr. (Shahid) Balwa, Mr. (Vinod) Goenka and Majestic Infracon were responsible for Swan at that time and for subsequently marketing the investment opportunity to Etisalat”.
“Given the seriousness of the allegations, and in the light of the Order on Charge and Supreme Court decision, Etisalat has taken this action to protect its interests and those of its shareholders,” it added. The UAE-based firm had paid $900 million in 2008 for acquiring almost 45 per cent stake in Swan Telecom, which was later renamed Etisalat DB (EDB).
Meanwhile, the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) has issued a notice to Etisalat DB on Reliance Infratel's plea seeking to recover Rs.1,200 crore from the operator for infrastructure lease, and asked it to file its reply within two weeks. As Etisalat has announced to exit India, Reliance Infratel has urged the TDSAT to attach the property and freeze the account of Etisalat DB to secure its dues.
