NEW DELHI: In a major setback to Vodafone India, the telecom department has denied its request for extension of licences in Mumbai, Delhi and Kolkata that are coming up for renewal in late 2014. A top communications ministry official said a similar request from BhartiAirtel has been rejected as well.
In a communication to Vodafone, accessed by ET, the telecom department (DoT) has said under the new policy on spectrum allocation, airwaves have been delinked from licence. Therefore, the firm must participate in the auctions to be held later this year to access airwaves at market price.
"Unless you participate in auctions and get your bid confirmed, you would not be entitled to wireless licence, which is a requisite," DoT said. It added that Vodafone was given a chance to participate in auctions, concluded early this month, but it stayed away.
"In the circumstances, we find no reason to grant you an extension contemplated by Clause 4.1. It is also not expedient to do so as there is no inclination shown by you to come to settle new terms and conditions in pursuance of and in conformities of the extant policies...Consequently, your request for an extension for 10 years on the same terms and conditions stands rejected," the DoT notice said.
DoT's refusal to prolong legal battle
The department went on to add that government held the sole right to allocate spectrum and that Vodafone cannot claim any right, "much less preemptive right" with regard to extension of its permits under Clause 4.1 of the licence.
A Vodafone spokesperson said the company was 'deeply disappointed' with the rejection of its request. "Vodafone is deeply disappointed with the summary rejection of its request for extension of its licences in Delhi, Mumbai and Kolkata service areas by DoT. This decision is against the i nterests of our several million customers in these cities/circles. In addition, there appears to be no acknowledgment by DoT of the full and faithful operation of the licence (by Vodafone) for 18 years...Vodafone has also been consistently contributing several crores in revenues to the national exchequer. Clearly, in DoT's opinion, these aspects are not important for determining expe-diency," the spokesperson said.
A senior telecom department official added that similar notices would go out to Bharti Airtel by Monday or early next week. DoT's decision will prolong the legal battle between telecom operators and the government and will in all likelihood cast a shadow on the government's plan to refarm, or redistribute, airwaves in the 900 Mhz band.
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