Department of legal affairs likely to clear Hutch shareholding

New Delhi: The department of legal affairs has taken the view that the 12.26 per cent stake held in Hutch-Essar by Asim Ghosh and Analjit Singh is in conformity with norms.

Legal opinion has cleared Ghosh and Singh''s stake of violating the Benami Transaction (Prohibition) Act, 1988, the Foreign Exchange Management Act, 1999, as well as certain sections of the Companies Act. No anomaly has also been found in the different reporting standards used in announcing the deal with stock exchanges and regulators in Hong Kong, United States and elsewhere.

This may clear the way for the finance ministry to give a green signal to Vodafone''s proposed acquisition of a 52 per cent stake in Hutch-Essar for $11.1 bn the sources added.

A crucial meeting of the FIPB is scheduled for Monday. The meeting is expected to focus on the law ministry''s examination of Hutchison Telecommunications International Ltd''s (HTIL''s) various arguments, including the rationale for the put and call options on Ghosh and Singh''s 12.26 per cent shareholding, as well as the 2.77 per cent held by IDFC Private Equity Ltd and its private equity arm.