3G imbroglio: Airtel moves SC against ending of roaming pacts

The government and the courts are between them making India's once-booming telecom sector look increasingly messy. A day after the Delhi High Court allowed the government to proceed with its decision to disallow spectrum-sharing between providers of 3G services, Bharti Airtel today approached the Supreme Court challenging the decision.

At the same time, the department of telecommunications (DoT) under the telecom ministry issued notices to Vodafone India and Idea Cellular cancelling their intra-circle roaming (ICR) agreements that enable these companies to offer 3G services in the circles where they do not have spectrum.

The DoT had, on 15 March, issued a notification restraining Airtel from providing 3G intra-circle roaming facilities in seven circles where it did not have the spectrum, and also demanded a penalty of Rs350 crore (at Rs50 crore per circle) for violating its licence terms.

The appeal against Thursday's high court order was mentioned before a Supreme Court bench headed by Justice R M Lodham, which has decided to put up the matter in the mentioning list for Monday.

Airtel, India's biggest telecom operator, has filed a special leave petition in the apex court challenging the setting aside by the high court of a DoT notification on 18 March holding ICR agreements illegal.

Airtel said in its petition that the order of the Delhi High Court would impact about 20 million subscribers, and the case needs to be heard at the earliest.

The high court on Thursday passed the order ending the stay on the DoT decision upon a plea by Reliance Communications Ltd, which stated that it has been incurring huge losses on 3G services every day while Airtel is using these services free of cost.

The bench allowed Reliance to be impleaded as a party in the case filed by Bharti before the single judge.

Reliance won the largest number of circles in the 2010 3G spectrum auction. ''Reliance has paid thousands of crores for the 3G spectrum and Bharti is using it for free in as many as seven circles, disrupting the level playing field. If this is allowed, then there is no requirement for any licensee to participate and purchase 3G spectrum in auction. This defeats the purpose of auction,'' it said in its petition.

Meanwhile, DoT has issued notices to Vodafone India and Idea Cellular cancelling their ICR agreements, and also slapped penalty of Rs550 crore on Vodafone and Rs300 crore on Idea for alleged violation of licence norms.

The top three operators - Bharti Airtel, Vodafone India and Idea Cellular - had signed pacts for sharing 3G spectrum and are offering services across each other's circles, as no operator had obtained a pan-India licence. Airtel has 3G spectrum in 13 circles, while Vodafone has it in nine circles and Idea in 11.

Both Vodafone and Idea declined to comment on the issue.

However, Bharti Airtel has not stopped services in the seven circles where it does not have spectrum. As Airtel was supposed to immediately stop services after Delhi High Court's order on Thursday, the government may impose additional penalty because of the delay in stopping services.

Bharti Airtel, Vodafone India and Idea Cellular together have about 12 million 3G subscribers in India. Of these, Airtel has 6.8 million (5.2 million active), Idea Cellular has 2.8 million and Vodafone India has 2.5 million.