Get ready to pay more for Internet and broadband services
Despite SC clarification, DoT to go ahead with 900 mhz auction

Corporate Feb 18, 2013

Post SC order, Sistema Shyam to pay Rs 405 cr as licence dues

By Sindhu Bhattacharya

New Delhi: The Department of Telecom (DoT) is readying demand notices for those telcos that lost licenses after the Supreme Court cancelled 122 permits in February last year.

The apex court has not only asked all those telcos who lost permits and did not bag spectrum thereafter to shut shop, but has also asked them to pay license fees for continuing operations till now.

A senior DoT official told Firstpost the department has worked out Rs 405 crore dues towards Sistema Shyam Teleservices (SSTL), the largest amount any telco will have to pay as per the SC judgement.

The demand notice for Sistema comes even as the company has said that its petition is pending in the SC and that it intends to participate in the coming auctions. Reuters

The demand notice for Sistema comes even as the company has said that its petition is pending in the SC and that it intends to participate in the coming auctions. Reuters

"Sistema's dues come to Rs 405 crore. We are working on other demand notices, these will be sent out to companies in due course," this official said.

The demand notice for Sistema comes even as the company has said that its petition is pending in the SC and that it intends to participate in the coming auctions.

Sistema lost 21 licenses after the SC judgement last February and last week, its curative petition was also dismissed. The company's stand has been simple: since there was no other CDMA player ahead of it or behind it in the queue for bagging CDMA licenses, there was no violation of the first come, first served policy of former telecom Minister A Raja and thus its licenses should not have been quashed.

Now that this plea has been rejected by the SC, Sistema wants to participate in the CDMA auctions (which are scheduled to be held two days after auctions for 1800 and 900 mhz bands conclude). It is interesting to note that the Government has already reduced CDMA spectrum price by 50% for the upcoming auctions, after it found that not a single telco came forward in CDMA auctions scheduled for November last year.

The DoT official quoted above did not divulge how much other telcos who lost licenses and continued beyond February 2012 will have to pay. But an official at one such telco said this payment may also end up in courts, with telcos challenging the order.

"Why did the Government or SC not tell us to stop operations immediately after the February judgement? And why should we pay now,?" he wondered.

Tata Teleservices has had to stop operations in J&K, Assam and North East, while Telenor has had to shut operations in Mumbai.

by Sindhu Bhattacharya

Related Stories.