The Comptroller and Auditor General (CAG) has said the department of telecommunications (DoT) gave undue advantage of Rs 3,367.29 crore to Reliance Jio Infocomm.
The Comptroller and Auditor General (CAG) has said the department of telecommunications (DoT) gave undue advantage of Rs 3,367.29 crore to Reliance Jio Infocomm (RJio) by allowing it to provide voice calling facility under the new licensing regime.
“Reliance Jio Infocomm (formerly, M/s Infotel) paid UL entry fee of Rs 15 crore and additional migration fee of Rs 1,658 crore in August 2013. This migration, allowed at prices discovered in 2001, resulted in undue advantage of Rs 3,367.29 crore to M/s Reliance Jio Infocomm,” said the CAG, which submitted its report in Parliament on Friday. It also pointed out that “even after four years of auction (BWA auction of 2300 MHz held in May 2010), the rollout of BWA services has been negligible”.
Pointing out the lack of due diligence in auction of spectrum for BWA services, the CAG report said, “DoT in 2013 allowed migration of ISP (internet service providers) licensees with BWA (broadband wireless access) spectrum to UL (unified licenses) which would enable them to provide mobile voice service using BWA spectrum, on payment of additional fee equal to the difference between the entry fee for a telecom licence and entry fee of national ISP permit.
This was apart from the entry fee as applicable for migration of ISP licensee to UL”.
While full fledged telecom operators were paying 3-5% of adjusted gross revenue as spectrum usage charge depending on the quantum of spectrum held by them, BWA spectrum winners were asked to pay just 1% of their AGR as SUC. “This relaxation would result in significant loss of revenue to the government over the 20 year licence period, since BWA spectrum had potential to provide voice services also in addition to data services,” CAG said.
As per BWA auction rules, companies were permitted to use their spectrum to provide services that are allowed under the licence held by them. Infotel Broadband was granted only the ISP licence which did not provide for voice calling facility.