| Policy & Regulation | | | Idea, Spice get DoT notice for delay in network roll-out | | | TT bCorrespondent | | 14 May 2011 | | |   The delay in network roll out may result in cancellation of licences
for Idea cellular and Spice Telecom in Karnataka and Andhra Pradesh as
department of telecom (DoT) has issued fresh showcause notices to
these telecom companies.
“Idea Cellular for Karnataka and Spice for Andhra Pradesh have been
issued showcause notice for cancellation of licence on account of
delayed rollout obligations,” telecom secretary R. Chandrasekhar said.
“The notices have been sent recently. The companies have been given 60
days to respond,” he said.
In June 2008, Aditya Birla group firm Idea picked up a 41.09 per cent
stake in Spice, resulting in six overlapping circles — Delhi,
Maharashtra, Andhra Pradesh, Haryana, Punjab and Karnataka — in which
both the companies held licences.
Though the DoT maintained that the merger did not get formal approval,
Idea said the telecom department had full knowledge of the deal.
Last month, the telecom ministry had secured an ex-parte stay from
Delhi High Court on the merger between Idea and Spice, a decision
opposed by the Aditya Birla group, which alleged that the DoT was
trying to cover up its “inefficiencies”.
Idea is facing charges of violating the terms and conditions by
retaining overlapping licences, but the company claimed it never
wanted to retain the unused spectrum and had offered to surrender the
overlapped licences.
Idea had said it did not breach any licence agreement with regard to
rollout obligations and the retention of overlapping licences.
Spice and Idea had procured these licences during the regime of former
telecom minister A. Raja, who was sacked last year when his ministry
came under fire for selling licences and spectrum at low rates,
costing the government billions of dollars in revenue.
Existing laws mandate mobile companies to provide commercial services
in at least 10 per cent of the district headquarters by the end of the
first year.
If the company fails to roll out services within 52 weeks of obtaining
a licence, the permit can be cancelled and the spectrum taken back.
Till now, the government collected around Rs 300 crore as liquidated
damages from new operators, including Idea and Spice, over their
failure to roll-out their networks as per the licence agreement.
Between November 2010 and January 2011, DoT sent show cause notice to
119 licences – belonging to Loop Telecom, Unitech Wireless, Etisalat
DB, Videocon and S Tel, Sistema-Shyam, Reliance Communication, Tata
Teleservices, Idea Cellular, and Aircel --- for not meeting roll-out
norms.
Telecom regulator Trai has also recommended the cancellation of
licences of leading mobile operators Idea Cellular and Spice in five
states for their failure to roll out services within the stipulated
time. |
|