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  1. Unitech Wireless liable to pay Rs 1,100 cr: DoT to SC

Unitech Wireless liable to pay Rs 1,100 cr: DoT to SC

The DoT on Monday told the Supreme Court that Unitech Wireless (now Telenor), Tamil Nadu, is liable to pay...

By: | New Delhi | Published: January 13, 2015 12:40 AM

The DoT on Monday told the Supreme Court that Unitech Wireless (now Telenor), Tamil Nadu, is liable to pay it dues to the tune of around R1,100 crore on account of obligations arising out of grant of Unified Access Services Licence (UASL) in 2008.

A bench headed by Justice J Chelameswar issued notice to the company after senior counsel Guru Krishna Kumar, appearing for the Centre’s department of telecommunication (DoT), argued that these dues pertain to licence fees, spectrum usage charges, one-time spectrum charge, penalties due to violation in respect of electromagnetic radiation (EMR) and default in customer application form (CAF) audit, liquidated damages (LD), etc.

The liability payable by the company on account of licence fee dues is R128.87 crore for the period between 2007 and 2012, around R17.25 crore for spectrum usage charges, and R289 crore as penalty for violations that include EMR and CAF audit dues. DoT said spectrum usage charges due for FY 2011-12 were R46.15 crore, including interest as on January 31, 2015, and the outstanding spectrum usage charges in respect of seven LSAs had been assessed for the FY 2012-13 at R1.72 crore.

According to Kumar, at the time of moving the TDSAT for return of the performance bank guarantee, Unitech Wireless continued to provide services and was, therefore, liable to pay licence fees. Various dues continued to be payable by the licensee even after its licenses stood quashed in February 2012 and it ceased to provide services in March 2013, the DoT said, adding that the assessment of licence fees for the  2012-13 fiscal was under process as the firm hadn’t submitted its documents on time.

While DoT has issued show-cause notices to the company to pay one-time spectrum charges amounting to R652.69 crore, demand for imposition of liquidated damages of R7 crore each for default in second phase rollout obligation in the North East and West Bengal Licence Service Areas has not been yet finalised.

However, senior counsel Meet Malhotra, appearing for Unitech, denied these claims. The bench had last week asked for these details after the DoT challenged the TDSAT’s April 2014 order that directed the release of performance bank guarantees furnished by Unitech Wireliess at the time of grant of  UASL in 2008.

According to sources, DoT has collected about R350 crore from new players, including Unitech Wireless (Uninor), Etisalat DB, Sistema Videocon and Loop, and others. Unitech Wireless is one of the operators whose licenses were cancelled by the SC in February 2012.

Stating that the TDSAT’s order has serious ramifications of a fiscal nature arising from the premature release of the PBGs, DoT said the conclusion of the tribunal that PBG are intended only to secure the roll-out obligation and that upon completion of such obligation, the PBG was to be released was erroneous as it failed to appreciate that the PBG may be invoked to secure all obligations of a licensee under the license and not merely to the roll out obligation. The UASLs were initially issued to eight corporate entities of Unitech for various circles in 2008 and the entities had later merged. DoT had imposed liquidated damages upon Unitech in 2010 for delay in fulfilling the 10% roll out obligations. As per the conditions of the UASL, the telcos were required to roll-out their networks within one year from the date of allocation of spectrum. The company had challenged the same before the Telecom Disputes Settlement And Appellate Tribunal which in January 2012 had directed DoT to refund the amount deposited by the company at the rate of 12% a year.

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