DoT defers guarantee encashment

The three companies on Tuesday challenged the single judge order passed Monday before a division bench comprising Justice Arun Kumar and Justice Manmohan Sareen saying the impugned order failed to consider some of the vital issues regarding contractual obligations of DoT.

The DoT on Monday initiated the process for encashment of bank guarantees of these four companies following rejection of their plea seeking interim injunction against the department from encashing bank guarantees.

The assurance to put on hold the remittance of the bank guaranteesof four companies was given by attorney general after consultations with DoT officials.

In another case, Justice Dalveer Bhandari reserved the judgement on a petition filed by J T Mobile seeking stay on encashment of its bank guarantee for Karnataka basic telecom circle worth Rs 126 crore by DoT.

The total amount recoverable from the four companies is nearly Rs 439 crore. Birla ATamp;T alone has pledged an amount of Rs 313.80 crore, securitised in the form of post-dated cheques to cover the principal.

These four telecom companies had failed to pay 20 per cent of the licence fee by February 28, the last date set by the ministry of communications. Subsequently, they went to the court.