DoT may move against TDSAT’s Idea order

Govt may challenge in SC TDSAT ruling that set aside DoT order imposing Rs 27 cr penalty on Idea.

Published: April 6, 2012 7:57:09 pm

The government is planning to challenge in the Supreme Court the telecom tribunal TDSAT ruling that had set aside a DoT order imposing Rs 27.65 crore penalty on Idea Cellular for delaying its roll-out obligations in five circles.

According to sources,discussions are on within DoT on challenging the TDSAT order in the apex court.

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In a judgement in December,the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) had set aside DoT’s order imposing penalty on the Aditya Birla group firm for delay in roll-out obligations.

TDSAT was of the view that there was a need to issue Show Cause Notice (SCN) to give Idea an opportunity to present its case.

DoT had imposed liquidated damages worth Rs 27.65 crore on Idea Cellular along with Spice Communications for missing roll-out targets. Spice Communications was acquired by Idea in 2008.

Idea Cellular was served demand notice for missing the roll-out targets in Karnataka and Punjab service areas.

Telecom licenses of company for both these circles has been cancelled by Supreme Court in February along with 120 other telecom licences of various companies.

Spice Communications was penalised for Haryana,Andhra Pradesh and Maharashtra circle.

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In the notice,Idea and Spice were asked to pay Rs 7 crore each,for delay of over 52 weeks in Karnataka and Andhra Pradesh circles. As per license conditions,the company has to be given SCN as there was a delay of over 52 weeks.

For Punjab circle,Idea was asked to pay Rs 4.55 crore liquidated damages for delay of 39 weeks in meeting roll-out obligation. Spice Communications was asked to pay similar amount for 39-week delay in Haryana and Maharashtra circles.

However,Finance Wing of DoT is learnt to have clarified that as per the UAS licence agreement,there is no specific stipulation for issue of show cause notice,except in cases where the delay is more than 52 weeks. Such a delay may trigger termination of licence.

“In view of this,it may be appropriate to issue a demand notice,and providing for immediate payment of the liquidated damages and for initiating further action for non payment within stipulated time as per licence condition,” Finance Wing of the Department is learnt to have said in its clarification.

As per licence terms,a operator has to comply with its roll-out obligations in two phases.

In the first phase,10 per cent of the circle area should be covered within a year from the date of allocation of spectrum. The balance 50 per cent is to be done within a period of 3 years,failing which penalty is imposed.

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