India's Enforcement Directorate (ED) has filed charges against four mobile phone companies for Foreign Exchange Management Act (FEMA) violations totalling nearly INR 43 billion in the 2G spectrum case, reports The Economic Times. The agency named Swan Telecom, Loop Mobile, Loop Telecom and S-Tel in a charge sheet filed before its special director. The ED said Swan issued shares to a foreign investor Etisalat and an Indian investor Genex Exim for an 'abnormal value'. It also said equity issued to Genex Exim was an indirect foreign investment as funds were brought in from Dubai through an intermediary. The agency said the FEMA violations by the company amounted to INR 36.08 billion. The ED charged Loop Mobile for Fema violations of INR 4.31 billion. In S-Tel's case, the ED said the company did not refund the balance of the FDI to the foreign investor Bahrain Telecom, within the stipulated period of time resulting in FEMA violations of INR 9.66 million. Representatives of these telecommunication companies will have to appear before ED officials. If the charges against them stand, they could be penalised with a fine amounting to three times the sum involved in such violations or up to INR 0.2 million where the amount of contravention is not quantifiable. ED said it suspects FEMA violations by Virgin Mobile and it was also checking the pricing issue of shares between Unitech and Telenor.
(C) Telecompaper
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