Hutch-Vodafone deal challenged in High Court

New Delhi, Mar 7 (UNI) The deal between the telecom major Hutch and Vodafone has been challenged in the Delhi High Court on the ground that the new company has more than 89 per cent foreign shares against the foreign direct investment(FDI) cap of 74 per cent in telecom policy.

Filing a PIL before the High Court, Telecom Watchdog, a voluntary agency, has alleged that with the purchase of the majority shares of Hutch by Vodafone, the FDI in the telecom service provider had crossed 89.03 per cent.

When the petition came up for hearing today, a division bench of Chief Justice M K Sarma and Sanjiv Khanna directed the petitioner to provide copies of the petition to the respondents-- Ministry of Communication and Information Technology, Finance Ministry, Telecom Regulatory Authority of India(TRAI), Hutchison International (HTIL) and other shareholders.

The matter will come up for hearing on Friday.

The telecom sector is unversally considered to be an extremely sensitive area and most countries of the world regulate it by not giving majority stakes to foreigners, said the petition.

Seeking direction to the authorities to initiate prosecution under various sections of the Foreign Exchange Management Act (FEMA) against some of the share holders including Asim Ghosh, the Managing director of Hutch, and Max India chairman Analjit Singh, the petition said a huge amount of funds had been transferred through illegal routes to various countries.

In February second week, HTIL announced the sale of its 67 per cent stake in HEL to Vodafone.

UNI