In a rather crucial judgment, the Supreme Court has ruled that telecom companies that failed to win fresh 2G spectrum, and those others who did not participate in the auction, cannot operate henceforth. The court, in its ruling, stated, “The telecom companies which have been unsuccessful in the bidding and those after the cancellation of the licences did not participate in the fresh auction are directed to cease from continuing from operation forthwith and the successful bidders will immediately start in their respective circles.”
A bench comprising justices G S Singhvi and K S Radhakrishnan ruled that those telecos, which were okayed to continue operation after their licenses were scrapped by the February 2012 judgment will have to pay the reserved price for the license for the round 1 of the auctions held last year.
Reportedly, earlier the court had extended the deadline, so as to allow telcos to continue operating, by way of an interim order. Additionally, the ruling bench clarified that the court's order from last year will not be applicable on telcos with spectrum with 900 MHz band.
Supreme Court delivered its ruling today (Image credit: Getty Images)
Last year, the Supreme Court revoked all 122 telecom licences issued under a scandal-tainted 2008 sale, a fresh embarrassment for the government, which plunged the mobile network market of Asia's third-largest economy into uncertainty. The ruling was a setback for Prime Minister Manmohan Singh's government, which oversaw the sale of the licenses at below-market prices, costing the exchequer up to $36 billion in lost revenues. The licences affected by the ruling included all of those held by Unitech Wireless, the Indian joint venture of Norway's Telenor and Unitech.
Interestingly, the company (Telenor) was to approach the telecom department for an extension of its Mumbai mobile permit beyond January 18, since it may bid for 2G airwaves in the next auction before March 31, 2013. Telenor reportedly also announced that it will switch off its network in Kolkata and West Bengal on January 19. The telco, it has been known, has put into effect the 90-day lock-in, owing to which customers across Kolkata and West Bengal will be able to port out of their network, even if they were issued a connection less than 90 days ago.
Last year in December, the Telecom Regulatory Authority of India (TRAI) had asked Sistema, Telenor, Videocon and Tata Teleservices to inform their customers of the discontinuation of their services post January 18. According to the Economic Times, these mobile companies had their licenses cancelled following the auctions. TRAI reportedly has given these telecom companies a 10-day deadline to intimate all their users in those circles where they failed to renew their permits, by way of either a text message or in writing. Reportedly, the companies had in all 26 million customers in those circles where they could not renew their permits.
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