New Delhi: Objecting to the show cause notice issued to it on 3G intra-circle roaming, India's second largest telecom operator Vodafone Tuesday said the move will undermine investors confidence and impact future spectrum auctions.
"At the outset we submit that the issue of this show cause notice is without authority of law as also bad in law," Vodafone's Resident Director TV Ramachandran said in the letter.
Vodafone said that it reserves the right to take appropriate steps to seek damages for the losses that company is facing due to DoT's stance.
DoT had issued the show cause notice to Vodafone on May 31 calling its roaming pact with Bharti Airtel and Idea Cellular in service area where the two did not win 3G spectrum in 2010 auction as violation of licence conditions.
The notice said the agreement signed between the company with Bharti Airtel and Idea Cellular was in nature of sub-leasing of 3G spectrum which is violation of licence conditions.
It mentioned that Bharti Airtel did not have 3G spectrum in Haryana, Maharashtra, UP East and Kolkata while Idea Cellular did not hold the spectrum in Chennai, Delhi, Kolkata and Tamil Nadu. The two companies were facilitating 3G services in these areas using Vodafone's spectrum.
The company argued that intra-circle roaming was allowed as per clarifications given by DoT before the 3G auctions and the position taken after it invested Rs 11,617.86 crore for 3G spectrum in 9 service area "is contradictory".
Calling the stand of DoT "arbitrary, inconsistent, unfair and unreasonable", Vodafone said it will not only "give rise to serious disputes and challenges but will also irreparably impact all future auctions that may be conducted by the DoT as bidders would have no faith or rely on any statements made by the DoT."
The company has requested DoT to "withdraw the show cause notice", and provide explanation to its stand on 3G roaming agreement.