DoT seeks legal opinion on extension of MTNL licence

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Published: April 6, 2019 3:22:29 AM

The 20-year licence of state-run MTNL is expiring on April 6 and if the company wants to renew it, it has to pay a renewal charge of around Rs 11,000 crore. On its part, MTNL has held that the expiry of the licence does not fall in April 2019 but in January 2021.

DoT, MTNL licence extension, MTNL licence, MTNL, industry, newsDoT seeks legal opinion on extension of MTNL licence

The Department of Telecommunications (DoT) is seeking legal opinion regarding extension of MTNL’s licence for two years. In the interim, services will continue without any disruption.

The 20-year licence of state-run MTNL is expiring on April 6 and if the company wants to renew it, it has to pay a renewal charge of around Rs 11,000 crore. On its part, MTNL has held that the expiry of the licence does not fall in April 2019 but in January 2021.

Sources told FE that although MTNL has taken legal opinion from Vikramjit Banerjee, additional solicitor general, government of India, who has supported its stand that the licence expires in 2021 and not in 2019, DoT will also ask for opinion from Attorney General KK Venugopal to rule out any further litigation on the issue.
“Based on the legal opinion, we will decide on the further course of action. Even if the opinion is against extension, DoT will ensure that MTNL’s services continue. Capital will be arranged either through borrowings or government infusion,” a source in DoT said.

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As earlier reported by FE, MTNL’s chairman and managing director PK Purwar has written to DoT that if the government does not accede to its request regarding the date of expiry of licence in 2021, it has no option but to shut down its 2G services, which has around 15 lakh customers. The 3G services can continue as it got 3G spectrum in 2010 – its validity is till 2030. “Non-correction of effective date of MTNL’s CMTS licence to 11.01.2001 will ultimately result in closing down of services beyond 05.04.2019 to MTNL mobile subscribers and in-roamer customers of BSNL. In order to continue providing uninterrupted mobile services, the extension of MTNL’s CMTS licence along with spectrum is an urgent necessary,” the CMD has written to the DoT secretary.

MTNL has also written that in the event of DoT does not agreeing with MTNL’s request, it should issue specific and unambiguous instructions to it to close down its services after April 5. In case the DoT does not give any such instruction, it will continue to operate the services based on the legal opinion it has received from the ASG. It has even said that if the government does not accede to its request, it may seek legal remedies.

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