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Supreme Court asks telcos without spectrum to end service

Source : BUSINESS_STANDARD
Last Updated: Fri, Feb 15, 2013 20:24 hrs
Birds sit atop telecommunication towers in Hyderabad

The Supreme Court today held that telecom companies unsuccessful in availing of fresh 2G spectrum and those which did not participate in the auction process last November would cease to operate "forthwith".

The government had offered 1,800-MHz spectrum through an auction process after the apex court had cancelled 122 licences earlier.

The court also ruled that telecom companies that got spectrum in the auctions held on November 12 and 14, 2012, start their services in their respective circles immediately. Operators which have won spectrum include Idea Cellular, Telewings and Videocon Communications.

"The telecom companies which have been unsuccessful in the bidding and those after the cancellation of the licences did not participate in the fresh auction are directed to cease from continuing from operation forthwith and the successful bidders will immediately start (operations) in their respective circles," the court said.

The order has raised concerns, as Telenor had participated in the November auction through a newly floated company, Telewings Communications, which had won spectrum in six circles. However, the assets and the subscribers in these circles are controlled by Unitech Wireless, a joint venture with estranged partner Unitech Group, whose shares it has agreed to buy out, after which it would transfer the assets to the new company.

Some experts have said that under the Supreme Court order, Unitech Wireless has to stop services.

A senior government official said the government would ensure that consumer interest was protected and it could consider issuing temporary licences. In an affidavit earlier, the Department of Telecommunications (DoT) had told the SC that in case operators whose licences were quashed were not given extensions, DoT might consider issuing temporary permits to allow the telcos to continue operations till the coming auction.

In the affidavit, DoT had mentioned that "Unitech/Telewings" had won spectrum for six circles. It pointed out, "As per a letter from Telewings, Unitech's business is in the process of transfer to Telewings, which had participated in the auction."

Uninor said in a statement: "Uninor wishes to clarify that this order will have no impact on its operations and services in the six circles of UP East, UP West, Bihar and Jharkhand, Andhra Pradesh, Maharashtra and Goa and Gujarat since Telenor Group has already secured fresh spectrum for 20 years in these. Uninor services in these six circles will continue uninterrupted. For the remaining details, we will only be able to comment once the court order becomes available and has been studied."

A Bench comprising judges G S Singhvi and K S Radhakrishnan directed that those telecom companies allowed to continue operation after scrapping of licences by the February 2, 2012, judgment would have to pay the reserve price fixed for the licences in the first round of the auction held in November 2012.

The apex court, by its interim orders, had extended the deadline for them to continue operations.

The Bench clarified that the apex court's February 2, 2012, judgment would not be applicable on telecom companies holding spectrum with the 900-MHz band.

"The February 2, 2012, order will have no bearing on litigation relating to 900- MHz band," the Bench said, adding that it (900-MHz spectrum) was not the subject matter before it. The bench also directed to immediately put on fresh auction the entire 2G spectrum for the licences cancelled by it.

Uninor had 40.6 million subscribers in India till November 2012, according to the Telecom Regulatory Authority of India.

A Sistema Shyam spokesperson said the company had filed an application in the Supreme Court that it wanted to continue operations and intended to participate in the March auctions. The court was going to give a separate order on this, he said.


CROSS CONNECTION

  • Supreme Court cancels 122 licences held by eight telcos, including Telenor-owned Unitech Wireless, Idea Cellular, Tata Teleservices, and Sistema Shyam Teleservices (SSTL), in February 2012 for alleged irregularities in spectrum allocation in 2008

  • Companies file curative petition challenging the SC order

  • Apex court dismisses curative petitions of SSTL, Videocon Telecommunications, Idea Cellular and Tata Teleservices on February 14, 2013,

  • Idea Cellular, Videocon and Telenor get spectrum in November auction for some circles where they want to continue operations

  • SC on Friday says telecom companies unsuccessful in getting fresh 2G spectrum and those which did not participate in the auction process last November will cease to operate forthwith'

  • Friday's order raises concerns for Telenor's operations, as the company has won spectrum through Telewings, the new entity, and the assets are still being transferred from the earlier entity, Unitech Wireless

  • Other companies whose licences were quashed have stopped operations in circles where they did not get spectrum in November auction

  • Uninor had 40.6 million subscribers in India till November 2012, according to Trai

  • SSTL says SC is expected to issue a separate order for CDMA players

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