Vinod Rai, CAG report in middle of controversy

It all started with his report seven years ago. The 77-page explosive report on the 2G scam, brought forth one of the biggest "scams of our times", giving the then United Progressive Alliance (UPA) government jitters, which ultimately led to its downfall.
Special CBI judge OP Saini said in his judgement today that the prosecution had failed to prove the guilt of the accused beyond reasonable doubt.

The CAG report
Though today's verdict has acquitted all the accused, the 77-page report on the 2G scam cannot be overlooked. It had stated that licenses had been issued to ineligible applicants who had deliberately suppressed facts, disclosed incomplete information, submitted fictitious documents and used fraudulent means for getting licenses and thereby access to spectrum.
It had added that the licence holders who had bagged the rights had sold these stakes to the Indian/foreign companies at high premium within a short time. The premium earned by these new companies was estimated to be the true value of the spectrum. In a free and fair bidding process, these profits should have gone to the government.

Vinod Rai's track record
Vinod Rai is an Indian economist who served as the 11th Comptroller and Auditor General of India from January 7, 2008, to 22 May, 2013. Rai, a 1972 batch IAS officer of the Kerala cadre, started his career as the sub-collector of Thrissur District. He served as the MD of Kerala state co-operative marketing federation from 1977 to 1980.
During his term, Rai disclosed some of the biggest corruption scams of all times

• 2G spectrum licences scam
• Coalgate or coal blocks scam
• 2010 Commonwealth Games
• Wasteful expenditure on the fertiliser subsidy
• Holes in defence spending
• Anomalies in the award of contracts to exploit natural gas reserves.
  

On 30 January, 2017, the Supreme Court had appointed him as the interim president of the Board of Control for Cricket in India.
The mammoth 2G audit
Earlier media reports pointed out Rai had said the 2G audit had been conducted as per the global norms and insisted he never commented on policy formulation.
Also, news reports said Rai did not give the Rs 1.76 lakh crore figure as his final opinion. In his report, he actually gave out four different ways of calculating the potential loss to the exchequer, and these worked out to Rs 67,364 crore, Rs 69,626 crore, Rs 57,666 crore, and Rs 176,645 crore.
Breaking up
First, Rs 67,364 cr loss:  This was based on an offer by S Tel to voluntarily pay Rs 13,752 crore over and above the spectrum charge for revenue share payable if it was allotted a pan-India GSM spectrum of 6.2 Mhz
Second estimate of Rs 69,626 cr was based on the sale of equity at a premium by Unitech to Telenor. The revenue loss was calculated on the assumption that spectrum was the only thing being bought, since Unitech had nothing to add to the venture in terms of value
Third estimate of Rs 57,666 cr was based on a similar equity valuation, this time by the price paid for equity in Swan Telecom, which later became DB Etisalat
Rs 1,76,645 cr was based on the 3G price discovered in 2010.
What went wrong
CAG in its report had never stressed on the Rs 1.76 lakh crore loss figure. It concluded: "The fact that there has been loss to the national exchequer in the allocation of 2G spectrum cannot be denied. However, the amount of loss could be debated."
The CBI chargesheet against Raja and others in April 2011 had alleged that there was a loss of Rs 30,984 crore to the exchequer in allocation of 122 licences for 2G spectrum which were scrapped by the Supreme Court on February 2, 2012. Its report was adjusted gross revenue, while the CAG had given presumptive loss figure.