An Empowered Group of Ministers today decided to refund licence fee of companies whose telecom licences stand cancelled but have no criminal charge against them. The EGoM,headed by Finance Minister P Chidambaram,also decided to recommend to the Cabinet a one-time fee on existing telecom operators for spectrum they hold beyond 4.4 MHz. The Supreme Court in February had cancelled 122 licences granted during former Telecom Minister A Raja's regime. Operators wishing not to pay the additional fee would be allowed to relinquish the excess spectrum beyond 4.4 MHz. The one-time fee would be imposed from the day the Cabinet takes a decision on the matter. Companies willing to retain excess spectrum will have the option of making staggered payments in yearly instalments,officials privy to the EGoM deliberations said. The government is likely to rake in about Rs 27,000 crore from the one-time fee,they added. "If there is no case or no action is going on against telecom companies for no fault on their part (in obtaining licence in 2008),then the amount (licence fee of Rs 1,658 crore) will be refunded," an official said. He said the government will adjust this Rs 1,658 crore against the final price of spectrum that companies,whose licences were cancelled,will have to pay at the end of the November auction of airwaves. Government has allowed telecom companies impacted by apex court judgement to participate in auction if they are interested to continue their business. Till 2008,telecom companies were allocated licences for pan-India business for Rs 1,658 crore and 4.4 Mhz spectrum was bundled with licences. The government has set Rs 14,000 crore as the base or minimum price for bidding for the auction of spectrum released from cancellation of 122 licences by the Supreme Court in February this year. "We had a two-hour meeting today. We have tentatively resolved all the issues. We are now moving to the Cabinet and will try and get it to the Cabinet on October 16,if possible,so that the matter can be finalised," Telecom Minister Kapil Sibal said after the EGoM meeting. The view taken by EGoM would be placed before Cabinet,expected to meet on October 16,for final decision. As per the contract with government,the telecom companies were entitled to get additional 1.8 Mhz spectrum in the same amount but on fulfilling certain performance-based criteria. On one-time fee,a source said,"Old telcos will have to pay for spectrum over 4.4 Mhz for the remaining period of their licence period. The charging will be done from the time Cabinet decides on the issue." Cabinet has approved reserve price of airwaves frequencies in 1800 Mhz,currently used for 2G services,for pan-India business at Rs 14,000 crore and for 800 Mhz band,being used for CDMA services,it is 1.3 times times the price of 1800 Mhz band. The sources added that additional spectrum from now onward will be allocated against payment of price that will be determined through auction. Earlier in the day at the Economic Editors' Conference,Finance Minister P Chidambaram said that there will be two streams of income in the allocation of spectrum. "So together,the back of envelope calculations show,together we should be able to garner the amount that is budgeted for,about Rs 40,000 crore. We should be able to reach that target under both streams taken together," Chidambaram said. The two streams are auction for spectrum which will take place in November and the charge for extra spectrum. Earlier,Telecom Minister Kapil Sibal said all issues are "tentatively resolved" by the EGoM and the Cabinet will take a final decision based on the recommendations of the panel. Existing players were allocated pan-India permits with 4.4 Mhz of airwaves frequencies at price of Rs 1,658 crore but new telecom operators will have to pay a minimum of Rs 14,000 crore for similar set of airwaves for pan-India business in auction that are scheduled to start in November. Sibal said the timing of the Cabinet meeting depends on the Prime Minister's Office. "If the Cabinet meets on October 16,we will try that the Cabinet takes a decision on all issues. We are trying to resolve all these issues before October 19." Sources said CDMA players will be charged for spectrum above 2.5 Mhz. An official said DoT will decide separately in cases where companies have not been given initial spectrum to start telecom services. "There is only one case of this kind where start-up spectrum has not been given. The decision on it will be taken up DoT in some time," the official said. Based on these decisions,dual-technology companies will have to pay for additional spectrum for each licence they hold - based on the slab decided by the government,he added. In the estimates of Rs 27,000 crore one-time fee,the government has not included charges for additional spectrum allocated in 900 Mhz band.
