TN phone co gets Rs 55 cr gift’ on trust vote eve

New Delhi, May 7: Just a day before the vote of confidence in the Lok Sabha, the BJP-led coalition government made a major turnaround to ...

New Delhi, May 7: Just a day before the vote of confidence in the Lok Sabha, the BJP-led coalition government made a major turnaround to give a Tamil Nadu-based cellphone company an extension for its licence fee date. This order saves the company fee worth Rs 55 crore.

While Communications Minister Jagmohan sought to downplay the delaying of the date from which license fee had to be paid by 8 months by stating that the Attorney General had okayed it, the fact is that on several occasions prior to this, the government had rejected this demand for an extension. Interestingly, Jagmohan has rejected similar demands for extension by almost all private companies.

When contacted by The Indian Express, Jagmohan said: “The matter had been legally vetted by the Law ministry which had agreed and despite that we sought the AG’s views and only then gave our assent.”

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While that sounds good on paper, what it ignores is that Srinivas Cellcom has already got two extensions before this, each time by forcing the DoT to go back on its earlier view.

Srinivas had, in any case been given an extension of 9 months even when the license was originally signed due to delays in FIPB clearances. With the annual license fee for the Tamil Nadu cellular circle Rs 80 crore, even a month’s extension in the date from which the license agreement becomes operational saves the company Rs 6.7 crore. Sivasankaran, the owner of Srinivas Cellcom, was not available for comment as he was travelling abroad. An associate, Rajan, who answered his cellphone, said he had no comment to offer.

Even the Law Ministry has changed its views on the length of the extension to be given to the company. Despite stiff opposition from concerned officials in the DoT like the Members Finance and Production and the DDG and Director of the Cellular Wing, the Law Ministry was petitioned to grant an extension in December 1998. It granted an extension of four months, till August 24.

This was agreed to by Jagmohan on January 15, though the concerned DoT officials continued to resist it, pointing out that this would encourage other companies to make similar demands. Given this, the Law Ministry was once again petitioned, and it actually changed its earlier opinion. It granted the company yet another extension, this time till December 24, 1998.

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Following this, several meetings were held in the DoT and all officials went on the record opposing this. Notings on the file indicate that Jagmohan himself directed officials to call Sivasankaran and hear him out again. Three meetings of the Empowered Committee of the Telecom Commission, headed by the telecom secretary were called in March this year, each one repeatedly deciding that no further extensions were to be given. On March 30 it was decided to refer the matter to the AG, but a letter was sent to the company on April 5, saying no further extensions would be granted to it — that the license would become operational from April 24, 1998.

On April 16, 1999, the AG gave his assent, stating that the FIPB had delayed clearances to Srinivas Cellcom and that the company could not be penalised for this delay. While the AG was asked whether an extension could be given till December 24, 1998, the new extension granted was till December 31, 1998. With this, the effective extension that the company has got is a little over 8 months. During this period, had the extensions not been given, it would have had to pay around Rs 55 crore in license fee.