KATHMANDU: Bhawana Singh Shrestha has emerged prominently in the Ncell controversy, a telecommunications company operating in the private sector.
Despite owning a significant 20 percent share in the telecom giant, Shrestha remains elusive in public visibility within the Nepali business community.
Concerns surround Shrestha’s stewardship of local Ncell shares through Sunivera Capital Ventures Pvt. Ltd., with allegations ranging from questionable investment sources to tax evasion.
Investigations have reportedly uncovered irregularities in the acquisition of billions worth of Ncell shares from dubious origins, coupled with accusations of offshore tax avoidance.
Shrestha’s involvement in Ncell dates back to 2016, marked by a convoluted series of share transactions, including the purchase of Niraj Gobinda Shrestha’s 20 percent local shareholdings.
Reynolds Holdings held 80 percent of Ncell, while the remaining 20 percent was owned by Sunivera Capital Ventures, controlled by Acharya’s wife, Bhawana Singh Shrestha.
The 54th report from the Office of the Auditor General highlighted concerns over tax evasion in 80 percent of foreign investments and 20 percent of local share transactions related to Ncell.
The sale of these shares, initially purchased from Telia Sonera for NPR 1.44 trillion and sold seven years later for USD 50 million (approximately NPR 6.5 billion), sparked extensive debate among Nepal’s regulatory bodies, parliament, media, and political parties.
In response to mounting pressure, the government formed a five-member investigative committee, led by former Auditor General Tankamani Sharma Dangal, on December 7, 2023. This committee was tasked with probing the transactions involving Ncell shares.
Discrepancies in transaction records submitted to state agencies have raised further suspicions about the transparency and legality of operations conducted by Shrestha and Sunivera Capital.
These issues have been highlighted in the General Account report of 2073 BS and extensively covered by various media outlets, prompting renewed calls for a comprehensive investigation into the financial dealings and assets of Bhawana Singh Shrestha.
The Malaysian company Axiata Group announced on December 1, 2023, that it had sold its entire stake in Ncell to SpectraLite UK Limited, an offshore entity owned by Singaporean citizen Shatishlal Acharya, husband of Bhawana Singh Shrestha.
Axiata had acquired 80 percent of Ncell’s shares for 1.44 billion Nepalese rupees and subsequently sold them after 7 years for 50 million dollars (approximately 6.5 billion rupees), prompting significant scrutiny and criticism in Nepal.
In response, Nepal’s Parliament, including the Public Accounts, Finance, State Order and Good Governance, and Education and Information Technology Committees, initiated inquiries with regulatory bodies and government officials regarding the suspiciously low sale price of Ncell shares.
Rishikesh Pokhrel, Chairman of the Public Accounts Committee, confirmed that they had also formally requested the Commission for the Investigation of Abuse of Authority (CIAA) to investigate the transaction.
Under mounting pressure, the government formed a 5-member investigation committee led by former Auditor General Tankamani Sharma Dangal.
This committee, which included Secretary Fanindra Gautam, Joint Secretaries Ritesh Kumar Shakya and Baburam Bhandari, and Nepal Chartered Accountants Association President Sujan Kumar Kafle, conducted an extensive investigation and submitted its findings to the government, though the details remained undisclosed.
The report highlighted significant irregularities in Ncell’s share transactions dating back to its establishment under Spice Nepal, implicating non-resident Nepali businessmen like Upendra Mahato and Niraj Gobinda Shrestha.
Specifically, it recommended investigating and potentially prosecuting Bhawana Singh Shrestha for her role in purchasing and holding 20 percent of Ncell’s local shares, focusing on concerns related to the sources of investment, tax evasion, and potential money laundering.
This development underscores ongoing concerns over transparency and regulatory compliance in Nepal’s telecommunications sector, with implications for broader governance and economic integrity issues.
Section 3 of the Foreign Investment Prohibition Act, 2021 explicitly prohibits any form of investment abroad.
Violation of notices, orders, or instructions issued under this Act carries penalties of a fine up to 2000 units and imprisonment for up to 6 months.
Despite these provisions, Bhawana Singh Shrestha, a Nepali investor, registered and operated Sunivera Capital Ventures Pvt. Ltd. under Nepal’s Telecommunication Policy of 2060, which mandates that 20 percent of investments in Nepal’s telecommunications sector must be held by local partners.
The report also flagged a significant issue: payments made through a foreign company to TeliaSonera in 2016, warranting investigation under money laundering regulations.
In Bhawana Singh Shrestha’s case, assuming she is a Nepali citizen, her involvement suggests a potential breach of the law barring investments abroad.
However, the investigation report led by Dangal has not provided detailed disclosures on this matter.
Government shows disinterest in investigation report
Six months after completion, the investigation report on Ncell’s purchase and sale remains undisclosed by the government.
The 54th report from the Office of the Auditor General highlighted concerns over tax evasion in 80 percent of foreign investments and 20 percent of local share transactions related to Ncell.
Former Acting Auditor General Shukdev Bhattarai Khatri expressed disappointment that crucial aspects of the transactions were omitted from subsequent reports.
The committee led by former Auditor General Tankamani Sharma Dangal’s investigation uncovered violations by Bhawana Singh Shrestha, including off-market transactions in local share purchases of Ncell and illegal operations in Singapore without disclosing investment sources.
Based on the latest government investigation, derived from the Auditor General’s findings, Bhawana Singh Shrestha’s undisclosed investment sources prompt calls for asset laundering inquiries.
The report also flagged a significant issue: payments made through a foreign company to TeliaSonera in 2016, warranting investigation under money laundering regulations.
Despite past criticism by parliamentary committees over Ncell transactions, current discussions have dwindled.
Ambar Bahadur Thapa, Chairman of the Education and Information Technology Committee, admitted to being uninformed about recent developments but suggested media attention could reignite public scrutiny.
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