HC clears telecom deal with stiff terms

NEW DELHI, AUG 10: The Delhi High Court today allowed the Government to go ahead with implementing the new telecom package but stuck to i...

NEW DELHI, AUG 10: The Delhi High Court today allowed the Government to go ahead with implementing the new telecom package but stuck to its earlier suggestion that 8220;each and every basic and cellular licensee8221; submit undertakings to the court that if the next Lok Sabha did not ratify the package, they would agree to revert to the pre-bailout-package policy regime.

The interim ruling also allowed the Election Commission EC to intervene and stop the package if it so desires. The EC had earlier objected to the package, saying it violated the electoral code but did not give any orders as the case was before the court. The case will continue on December 6.Telecom operators have been reluctant to give such a blanket undertaking, and have spent the past few days, including on Sunday, parleying with the Attorney General as well as officials of the Prime Minister8217;s Office PMO and the ministry of communications. On Sunday, it was agreed that the Government would represent to the court that it would collect theseundertakings from individual operators. The court has, however, categorically said that each operator will have to give an undertaking, and to the court.

Adjourning the case till December 6 for a further hearing, the bench consisting of Chief Justice S N Variava and Justice S K Mahajan, today said that 8220;in passing the interim order the court has not gone into the merit of the petition, neither approved, vindicated, nor disapproved it.8221; This, of course, was in reference to a fax sent by the PMO to various newspaper offices hours after the August 3 hearing, where the PMO claimed that the court8217;s ruling was a vindication of the Government8217;s stand on the desirability of the new policy.

The court also stated that every company wishing to be part of the new telecom policy would have to give an undertaking to the court that in case the next council of ministers or the Lok Sabha disapproves of the policy, 8220;licensees would have no rights or equity under the said package and will revert to the existinglicences.8221; In the meantime, the court order stated by Justice Variava said, any new licences which are issued to operators would stand terminated if either the council of ministers or the Lok Sabha disapproves the policy. The bench told Attorney General Soli Sorabjee that licences should be issued to the operators only after they give an undertaking in this regard. Sorabjee said the Government would give the licence after getting the undertaking given to the court was incorporated in the agreement.

The operators said their undertakings filed before the court would be valid till December 31, 1999. The court8217;s ruling will only be applicable to licensees who give undertakings to the court and not to those whose licences have been terminated, the court said. Following today8217;s interim order, the Department of Telecom sent letters to all operators asking them to pick up copies of letters which stated what their outstanding dues are under the new policy, 15 per cent of these outstandings have to be paid up byAugust 15.

The PIL filed by the Delhi Science Forum challenged the validity of the NTP 1999, which provided for switching over to revenue sharing system from fixed licence fee regime for existing operators. The PIL alleged that the offer made to the existing operators to migrate to the revenue sharing system has resulted in a loss of Rs 50,000 crore of to the public exchequer in terms of licence fees forgone. The telecom operators have also been asked by the government to withdraw all cases pending in courts and in TRAI as a pre-condition for migrating to revenue sharing scheme.