Opposing framing of corruption and other penal charges against him, Balwa told Special CBI Judge O P Saini that the agency should have written a letter to the Prime Minister or the Finance Minister to know the actual loss to the exchequer due to the scam.
"The CBI must answer as to what is the actual loss to the state exchequer. It (loss) is the basis of the prosecution and it has to be supported with documentation," advocate Majeed Memon, appearing for Balwa, said.
Memon asserted that the CBI's case is based upon the loss to the state exchequer but the government had stated in Parliament that no loss was suffered and instead the tele-density in the country had increased in 2010 from what it was in 2004.
Memon also asked the CBI if any loss has been suffered by the state exchequer, who exactly was responsible for it and up to what extent.
He also said the probe agency must answer whether Swan Telecom was ineligible to get Unified Access Services (UAS) licence in January 2008.
Balwa's counsel also accused the CBI of adopting selective approach in arresting people in the case.
"It is surprising how out of various companies (which got licences for 22 circles) and persons, the CBI picked up A and B and left others. Why are they adopting the selective approach?," Memon asked, accusing CBI of conducting "a biased, selective and discriminatory approach" in the investigation.
"You (CBI) have just picked up one man of your choice from one point and the other from another point. CBI is blowing up the case so that the court would be hesitant to consider liberty of a person even after months. It is guilty of misleading the court," Balwa's counsel told the court.
Memon also asked the CBI to explain as to why former Telecom Minister A Raja is in jail if ministers belonging to the BJP or NDA government are not in jail despite evolving and following the same policy that Raja had pursued.
Without naming anyone, Memon submitted that Balwa is paying the price because of business rivalry.
"I (Balwa) am a successful businessman and thus I am paying the price because of my business rivals. There is a feeling of vengeance (in my business rivals) as I am a threat to my competitors," he said.
Balwa, arrested on February 8, is presently lodged in Tihar Jail along with other 13 accused including Raja and DMK MP Kanimozhi.
Charges of cheating, forgery, criminal conspiracy and corruption have been levelled against Balwa.
The CBI charge sheet has alleged that a bribe money of Rs 200 crore had been channelised from Balwa's DB Realty to DMK-run Kalaignar TV through a "circuitous route" via Cineyug Films and Kusegaon Fruits and Vegetables Pvt Ltd for grant of licence to Balwa's Swan Telecom Promoter.
The agency, in its first charge sheet, has alleged that Balwa along with other co-accused in the case entered into a conspiracy for manipulating the procedure for allocation of spectrum with the aim of favouring companies like Swan Telecom and Unitech Group.