CAG faults DoT for failing to recover Rs 679 cr penalty

The government auditor CAG has pulled up the Telecom Ministry for not recovering Rs 679 crore as penalty or liquidated damages from six new operators for missing the network roll-out schedule as per the licence.

New Delhi: The government auditor CAG has pulled
up the Telecom Ministry for not recovering Rs 679 crore as
penalty or liquidated damages from six new operators for
missing the network roll-out schedule as per the licence.

Out of 122 Unified Access Service (UAS) licences awarded
in 2008, as many as 85 licences were given to the six new
entrants to the telecom sector. The audit found that none of
them had rolled out services as per the provisions of licence.

These six companies are Unitech (brand name Uninor), Swan
(name changed to Etisalat), Allianz (since merged with
Etisalat), Datacom (name changed to Videocon), S Tel and
Shipping Stop DoT Com (name changed to Loop Telecom).

As per the conditions of the UAS licences, these
licensees were required to roll out the services in the 90 per
cent service area in metros and 10 per cent district
headquarters in other service areas within 12 months of the
date of award of licences.

Audit found that though these six new operators obtained
the initial 4.4 MHz spectrum in 81 service areas during the
period April 2008 to January 2009, none of them had rolled out
their services as required in any service area till December,
2009.

"DoT also failed to recover Liquidated Damages and
penalty of Rs 679 crore from these six operators for
inordinate delay in the rolling out of services till December
31, 2009," the CAG report said.

Since there were many existing telecom licensees in dire
need of this scarce natural resource (spectrum), it resulted
effectively in hoarding of the finite natural resources of
the nation by these operators, it added.

DoT did not earn any revenue from this natural resource
during 2008-09 and 2009-10 due to inordinate delay in the
commencement of services by these operators, the auditor
said.

PTI

By continuing to use the site, you agree to the use of cookies. You can find out more by clicking this link

Close