Reliance Communications and Reliance Telecom have been allowed to withdraw from rollout of services in rural areas under the Universal Services Obligation Fund (USOF) scheme by a law ministry's arbitral tribunal.
"I hold that the claimants are entitled to exit from their continued performance of the obligations under the agreements without levy of penalty or interest," Justice AR Lakshmanan said in the order issued last week.
The tribunal ruled that the companies can exit from all sites, including 8,500 implemented telecom sites and from about 5,000 non-implemented telecom towers across the country.
USOF was launched way back in 2007 to provide subsidy support for setting up and managing 7,871 infrastructure sites, or telecom towers, in rural and remote areas in 500 districts of 12 states. Both RCom and RTL had entered into an agreement with the USOF in June 2007.
The contention of the companies’ was that USOF failed to ensure delivery of a majority of telecom towers in a holistic manner and within the contractually-agreed timeline.
“RCom and RTL's legitimate and persistent stand with the USOF, that we have the right to be discharged from the reciprocal obligations under the agreement, is vindicated by this ruling”, said an RCom spokesperson. |