Sun TV Network has been in the news recently with the Ministry of Home Affairs (MHA) denying the security clearance for 33 channels under the network. The MHA had also denied security clearance to the radio and cable TV businesses of the group earlier. In the week that transpired we take an in-depth look at the issue.
Sun TV rises on recent report of a review
Post media reports emerging on recently on Sunday, 14 June that the Home Ministry might review its decision on granting security clearances to the Sun TV Network had seen the publicly listed company’s stocks rise by 12% in the initial hours of trading to close a little below the 6% mark. This is positive news for the network as the stance of the MHA up until recently did not seem in anyway ready to change its decision. A home ministry official was quoted in a report saying that they are open to reviewing their opinion provided the law officers give a good legal view regarding letting the broadcast company to continue operations despite the owners or directors facing money laundering or corruption cases. The matter is now expected to be referred to Attorney General Mukul Rohatgi as the Ministry of Information & Broadcast (MIB) and MHA seek further clarification on this issue. The decision by the law officials may change the stance of the MHA. The network’s promoter Kalanithi Maran is also expected to be in Delhi this week to meet top officials of the Home Ministry as well as the MIB, say media reports.
The Sun TV-MHA stalemate
Initial media reports emerged on Saturday, June 6 about the Home Ministry’s decision to hold back the security clearances. This saw the publicly listed media company see its biggest fall in shares to around 22% on Monday, June 8. The network at first denied receiving any communication from the MHA or MIB regarding this decision and said that the channels would continue on air. This decision was taken on account of the promoters of the network being involved in three cases primarily. One is Sun Group promoter Maran and his brother the former Communications & IT Minister Dayanidhi Maran’s alleged involvement in the Rs.540 crore Aircel-Maxis case investigated by the CBI. The other is the Enforcement Directorate (ED) examining the Marans for the alleged laundering of funds worth Rs.550 crore. Another case that hangs on the Marans is the allegations of an illegal telephone exchange on the premises of Sun TV for which unlawful gains are expected to be over Rs.400 crore. These reasons are the basis for MHA’s decision to deny security clearance to the 33 channels of the network on the grounds that it could have an adverse impact on the ‘economic security’ of the country.
The MIB and the MHA have not been on the same page with regards to this issue to deny the renewal of the license to the network for which it had applied last year (for which security clearance from the home ministry is required). The MIB wrote to the MHA asking for clarification on what constitutes as ‘economic security’. It wants to know how the economic security of the country can be affected by the economic offences of a company. The MIB had also asked the MHA whether there could be a possibility of it to review the decision. While the MIB has held meetings with the law ministry officials and the law secretary to look into the issue, the MHA is said to have stayed away say media reports.
While the MIB looks for clarification from the MHA and seeks the opinion of law officials, Kalanithi Maran had written to I&B Minister Arun Jaitley during last week questioning if the basis for denying security clearance was applied on all players. He said that there were TV companies, including those controlled by big business conglomerates which had pending cases from various ministry bodies but their security clearance had not been revoked. Maran had also written to Home Minister Rajnath Singh last week asking him to intervene on the issue and saying the company was never involved in any anti-national or criminal activity.
During last week the Madras High Court has also dismissed petitions filed by Sun TV and Kal Communications which challenged the attachment of their properties by the ED in the Aircel-Maxis case. This plea was not entertained as the case was being followed in the Supreme Court. This would have come as a disappointment to the network.
Options facing Sun TV
The MHA is expected to review the security clearance for the network if the Attorney General as well as top law officials are of the opinion that the odds are favouring Sun TV. As an MHA official in a recent media report was quoted saying that let a legal authority take responsibility for such a review of the existing position and they will then take a call. The delinking of the cases attached to the promoters from the network could see it getting the security clearance and the license for the 33 channels.
If the MHA’s decision stays the network has the option of approaching the courts and contending the order. It had done so when its FM radio and cable TV businesses had been denied renewal of their licenses.