DoT may withdraw licences given to 85 telcos

The Department of Telecommunications (DoT) is now reportedly contemplating cancellation of spectrum licences of all the 85 companies that were allocated spectrum overlooking their ineligibility.

The DoT has conveyed to the Comptroller and Auditor General (CAG) that it is considering issuing show-cause notices to these 85 companies, which is likely to be a prelude to the termination of their licences. But, ironically, the DoT itself has been hammered by the CAG for issuing these licences in the first place.

One of the most stunning observations made by the CAG in its report on the 2G spectrum scandal is that as many as 85 of the 122 applicants for 2G licence were ineligible but still were given licences. This constitutes almost 70 per cent of all licences given by A Raja as telecom minister in January 2008.

According to CAG, these applications fall into three categories - those that are incomplete, those that provided wrong information and those that suppressed facts. The CAG report minced no words while saying, "The companies used fraudulent means to get access to spectrum".

Among the companies found to be ineligible are eight Unitech group companies, including Infrastructure Pvt Ltd and Azare Properties Ltd, besides Shipping Stop Dotcom Pvt Ltd (now Loop Telecom), and Allianz Infratech, which merged with Etisalat DB Telecom PVt Ltd and Datacom Solutions and is now Etisalat DB Telecom.

These licences were given despite the companies not having the stipulated paid-up capital at the time of application. CAG had earlier asked DoT to cancel licences allocated to all ineligible companies and to ask them to apply afresh.