DoT failed to get Rs 1,649 cr fine from telcos after licence cancellation

Once again, the past has come to haunt the Department of Telecom (DoT). In a strongly worded letter, the Comptroller and Auditor General (CAG)has pointed out that the DoT has failed to raise Rs 1,649 crore in payments from telecom companies which lost their licences and then did not participate in subsequent auctions to win back spectrum. CAG has also pointed out that despite some of these licensees ceasing operations, spectrum assigned to them has also not been taken back by DoT.

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These licenses had been cancelled as a part of total 122 licenses cancelled by the Supreme Court in February 2012, after it found the policies of former telecom minister A Raja in awarding licenses and spectrum faulty.

So in essence, Raja's misadventures continue to haunt till now. It was the office of CAG which had ultimately unearthed Rs 1.76 lakh crore telecom scam and its observations of faulty processes followed by Raja in 2008 had led the SC to cancel all licenses awarded at that time. It remains to be seen what these fresh allegations lead to.

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A copy of this letter has been reviewed by Firstpost. It says DoT failed to charge nine quashed licensees for offering telecom services beyond what was allowed by the apex court. The last date till which such licensees were permitted to remain operational was February 15, 2013 so that they could participate in spectrum auctions in November 2012 and March 2013.

"Out of nine operators, only four - Unitech Wireless/Telewing ltd, Videocon Telecommunications/Data Com, Sistema Shyam Telesrvices and Idea Cellular participated in the auction and bought spectrum.....," Director General of Audit (P&T) R B Sinha said in the letter to DoT.

This means Loop Telecom, Etisalat DB (Swan), S Tel, Spice Communications and Tata Teleservices should have together paid the Government Rs 1,649 crore but did not.

Sinha says in the letter that Sistema Shyam continued operations in 11 service areas in March 2013 also when it should have discontinued in February. Of these 11 circles, Sistema won spectrum in subsequent auctions in only 8 circles. S Tel and Etisalat have subsequently ceased operations.

The amount of Rs 1648.91 crore has been calculated based on reserve price for spectrum which was fixed for the November 2012 auctions.

Sinha has also alleged that DoT has not taken any steps to get back spectrum from such licensees.