SC asks RCom to deposit 50% of increased spectrum usage charge

Written by: Pti
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New Delhi, Feb 1 (PTI) The Supreme Court has directed twoAnil Ambani group firms Reliance Communications and RelianceTelecom to deposit 50 per cent of the increased spectrum usagecharge demanded by DoT and to submit a bank guarantee for therest within two weeks.

A three-judge bench headed by Chief Justice S H Kapadiaalso issued notice to DoT directing it to file reply overenhancing spectrum usage charge.

"The Operator - Reliance Communications Ltd will depositfifty per cent of the outstanding principal amount net ofinterest in the Supreme Court Registry within a period oftwo weeks," said the bench, which also consisted justices K SRadhakrishnan and Swatanter Kumar.

It further said, "The balance fifty per cent of disputedoutstanding amount net of interest will be secured by way ofBank guarantee of a Nationalised Bank to be given within aperiod of two weeks".

The apex court has directed to tag the Rcom and R Tel''sappeal with the other telecom operators -- Vodafone, BhartiAirtel, Bharti Hexacom (operating in Rajasthan), Idea Cellularand Uninor -- which have challenged DoT''s increasing the usagecharges 3-8 per cent of adjusted gross revenue, depending onquantum of spectrum held by an operator.

It has also asked Managing Director of the two firms to"give an affidavit to the effect that, in the event of CivilAppeal being dismissed, it will pay the balance amount withinterest".

Besides, it has directed RCom to file a chart of theprincipal amount, which is outstanding before the registry ofthe Supreme court within one week.

The court also warned, "We make it clear that if there isa breach of any of the afore-stated conditions, the impugnedorder will come into force with immediate effect".

The ADAG group firms are challenging the order of thesectoral tribunal TDSAT, which had declined to stay DoT''s hikein the spectrum usage charge.

The DoT had asked the two ADAG group firms to deposit Rs94 crore for the spectrum charges as per the new rules

On October 22, the Supreme Court had stayed the TDSATorder upholding a hike in 2G telecom spectrum (radio waves)usage charges, but had asked Bharti, Vodafone and Idea todeposit with it 50 per cent of the proposed increase in feewith court''s registry. .

Telecom service providers have to pay a percentage of their adjusted gross revenue (AGR) to the government asspectrum usage charge, which depends on the quantity of radiowaves held by them.

The new charges vary between 3 and 8 per cent of AGR,from 2-6 per cent earlier.

As per new charges, an operator holding spectrum up to4.4 Mhz will have to pay 3 per cent of the AGR compared to twoper cent now.

Vodafone had to pay Rs 135 crore and the two Bharti firmshave a joint liability of Rs 220 crore on account of enhancedspectrum usage charges.

On September 1, 2010, TDSAT had held that the decision toincrease the charges was taken by DoT after following properconsultation process of the sectoral regulator Trai andmandatory approvals from the Telecom Commission and Group ofMinisters.

Challenging the TDSAT''s order, operators have submittedthat the tribunal had ignored Trai''s recommendation and thecharge was increased "without any effective and timelyconsultation process" and was violative of the Trai Act.

They further submitted that Trai, in its recommendationon May 11, 2010, had disagreed with the enhanced 2G spectrumusage charge.

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