Supreme Court extends deadline of existing operators of 2G spectrum

Supreme Court extends deadline of existing operators of 2G spectrum

The Supreme Court today extended till February 4 the January 18 deadline for existing operators of 2G spectrum to carry out operations and asked the Centre to spell out the price to be charged for continuing with their service after cancellation of licences last year.

"We want to know what is the price. Just put it in a sealed envelope what is the amount to be paid (by the existing operators of 2G) after our order of February 2, 2012," a bench comprising justices G S Singhvi and K S Radhakrishnan said while posting the matter for hearing on February 4.

"The existing operators are allowed to continue operations till the next date of hearing," the bench further said.

The apex court had on February 2 last cancelled 122 licences for the 2G spectrum and had directed the DoT to hold fresh auction for them within four months which has been extended by interim orders from time to time.

The bench asked DoT's counsel and senior advocate P P Rao to collect information about the telecom companies which emerged as sucessful bidder in the first round of auction that took place on November 12 to 14 last year and what is going to be the proposed reserve or base price for second round of auction to be held on March 11.

It also wanted to know from the DoT as to how many operators whose licences were cancelled by it on February 2, 2012, participated in the fresh auction and how many of them continued with their operation.

"How many licencees stopped operation and secondly you have to find out what decision you have taken to fix price for future auction," the bench told Rao.

The court also said it has to be made clear whether those existing operators who did not participate in the auction would be allowed to continue or not.

During the hearing, the bench observed that the telecom operators enjoyed the benefit of its order to continue with operations till the fresh auction and they are liable to pay the reserved price after January 18, 2013.

The court also said the decision to reduce the bidding price after the first round of auction for spectrum is bound to evoke further litigation.

"The price in the first round of auction was different and now you are reducing the the price in the second round of auction (to be held on March 11) which is bound to generate litigation," the bench said but added that "we are not concerned with litigation".

Prashant Bhushan, appearing for the NGO, Centre for Public Interest Litigation (CPIL), which was one of the PIL petitioners on whose plea the licences of 2G were cancelled, said existing operators should not be allowed to continue as the consumers have the option to move to other service providers.

Senior advocate Harish Salve, appearing for some telecom companies, said the base price fixed for auction was not conducive for many to participate in the bidding process and as such the CDMA operators like Tata opted out and Sistema Shyam Teleservice Ltd also did not participate in the auction because of pricing model.

The Centre had asked the Court to consider allowing the telecom operators, whose 2G licences were cancelled last year, to continue to operate after the January 18 deadline with a condition that they "will be liable to pay" for the spectrum as per the proposed price of the upcoming auction scheduled on March 11.

The Department of Telecom (DoT) had apprised its stand in an affidavit which assumes importance as the court had permitted the telecom operators to continue to operate till January 18 this year.

The DoT has asked the apex court to consider allowing it to grant "temporary licences" to such operators till the completion of the fresh bidding process.

It said this plea could be taken into account if the court decides not to extend any further the January 18 deadline as "such an arrangement will avoid disruption of services to the subscribers on one hand and safeguard the public revenue on the other".

As per the apex court order, 21 licences of Sistema Shyam Teleservices (MTS), 16 permits of Telenor controlled Uninor, 15 of Videocon and 3 CDMA permits of Tata Teleservices were to stand cancelled from January 18, with around 25 crore subscribers in the country.

Telenor is in the process of transferring the business of Uninor in 6 circles to new entity Telewings Communications, which recently won spectrum.

The apex court had on November 27 last year said that the telecom operators, whose licences were cancelled by it but continued to operate due to delay on government's part to hold fresh auction of 2G spectrum, might have to pay for using the radiowaves on the basis of current price.

The apex court had on February 2, 2012, quashed 122 2G licences while allowing the telecom operators to run their services for four months after which the order was to become operative.

The date expired on May 2 but the apex court allowed the operators to continue providing services as the Centre failed to put the spectrum on auction which was done only on November 12, 2012.

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