The report circulated by PAC Chairman Murli Manohar Joshi, which is most likely to be contested by members of the ruling UPA, is also understood to have attacked the then Finance Minister P Chidambaram for recommending to the Prime Minister to "treat the matter as closed" instead of taking against those responsible for loss to the exchequer.
The voluminous report reportedly had some unpleasant words for Prime Minister Manmohan Singh, who had kept his office at "arm's length" in 2G spectrum issue which helped Raja "to execute his unfair, arbitrary and dubious designs".
The report says the Prime Minister on January three, 2008 wanting to keep the PMO at "arm's length" seemed to have given an "indirect green signal" to Raja to go ahead and "execute his unfair, arbitrary and dubious designs".
The controversial distribution of licences and spectrum was taken by the DMK representative in the Cabinet on January 10, 2008, which the CAG had estimated a presumptive revenue loss of over Rs 1.76 lakh crore.
The report, which will come up for consideration at tomorrow's meeting, said the PMO certainly either failed to see the "forebodings or was rendered a mute spectator".
The committee said it was highly perturbed to note that the considered and imperative advise given by the Prime Minister and genuine concerns expressed by him on the developments in the telecom sector in his November 2007 letter to Raja was "just disregarded" by him.
"The Prime Minister was in fact misled when he was informed by the minister (Raja) that the issue of auction of spectrum was considered but not recommended by the Telecom Commission and also not recommended by TRAI. The minister was saying half truth, concealing the other half, concealing his ulterior design," the report said.
In its criticism of the PMO, the report said the PMO's reply that no suggestion of the Law Minister to set up an Empowered Group of Ministers was received by them does not convince the committee.
"The PMO was very much aware of Law Minister's suggestions but the counter view of the Communication Minister got overriding preference to the Law Minister's view for some unknown reasons and thus no effort was made by the PMO to initiate the process of constitution of the EGoM.
"The PMO certainly either failed to see the forebodings or was rendered a mute spectator," the report said.