Govt-Trai play lawyer-lawyer

Written by Rishi Raj | Sunil Jain | New Delhi | Updated: Jul 22 2011, 07:12am hrs
Its now going to be my lawyer versus your lawyer in the fight between the Department of Telecommunications (DoT) and the Telecom Regulatory Authority of India (Trai) on cancelling licences of those firms that have not rolled out their networks. While the Trai backed its initial recommendation to cancel 74 licences with two legal opinions from former Supreme Court judges, the DoT has also now decided to seek a legal opinion.

The DoTs stand is that only 12 licences are fit to be cancelled. DoT secretary R Chandrasekhar told FE, We have received the Trais revised recommendation which sticks to its original stand. Since it has been backed by legal opinion, we are also going to seek the same from our side. In the government there is an established procedure for seeking such opinion and after following that only will we come to any conclusion.

The gist of the difference, as FE reported last week, is over what constitutes telecom services. The Trais view, backed by the legal opinion that it has got, is that rollout of telecom services means the firms must have an active subscriber base. So, the Trai says, the concerned telecom operators only had technical rollouts, which means they had just put up Base Transmission Stations (BTS) but didnt have any customers; naturally enough, there was no revenue these firms shared with the government. According to Trai, none of these operators filed any tariff plan with the regulator as is mandated, nor did they submit their monthly subscriber figures or their revenues all signs that their rollout was just a formality.

The DoT, on the other hand, says that most of the operators have put up BTS and registered themselves with the TERM cell of the department. Further, DoT argues that since the licence doesnt specifically say that there has to be a minimum number of subscribers to prove the rollout, their licences cannot be cancelled. Out of Trais list of 74, the DoT has found only 12 licences fit to be cancelled. In addition, it has found five more which have not fulfilled the rollout criteria.

The bulk of the 74 licences in question fall within the 122 given by jailed telecom minister A Raja. A few of them were given by his predecessor Dayanidhi Maran. Of the 74, Trai had recommended that 43 be cancelled right away as they had not rolled out services at all, while the remaining 31 had made just technical rollouts. In the latter case, it had said that the DoT should cancel them after legally examining their case.

The original recommendation by Trai was made in two tranches in November and December last year.

In June, however, the DoT wrote back citing its differences and on July 15, the Trai reiterated its earlier stand, this time backed by legal opinion.

Normally, the DoT goes by what the Trai recommends, but if there is a difference, it has to refer the matter back to the Trai. If the Trai doesnt change its view, under the rules, the DoT can go ahead and reject the recommendation.

So, the DoT can cancel just 17 licences instead of the Trais 74. But the move is likely to prove highly embarrassing especially given the high profile the case has got. This is the reason that before taking a final call the DoT wants to obtain a legal opinion from its side also.