Telecom ministry begins issuing show-cause notices

The telecommunications ministry on Monday began issuing show-cause notices to the 85 telecom licence holders identified by the Comptroller and Auditor General as having obtained 2G licences by submitting ineligible applications; as well as to 69 others cited by the Telecom Regulator Authority of India (TRAI) for failing to meet service rollout obligations.

According to department of telecommunications (DoT) secretary R Chandrashekhar, "The entire process of issuing show-cause notices to roughly 200 licence-holders in both categories will be completed over the next two to three days."

Chandrasekhar told newspersons in New Delhi that operators would be given 60 days to respond to the show-cause notices, after which each case would be dealt with individually. "After studying their response, a decision will be taken on whether these (licences) need to be cancelled or a penalty should be imposed," he said.

The CAG had identified 85 of 122 licences issued in 2008 to be ineligible as companies misrepresented facts. In addition, TRAI wrote to the DoT on 18 November this year asking it to cancel 38 licences and legally examine another 31 for failure to meet rollout obligations.

In both cases the DoT, as the licensor, should have been the one to identify these irregularities, which according to the CAG it failed to do. The department now faces investigations from several quarters to uncover the violations in procedures that are estimated by CAG to have led to the loss of Rs1.76 lakh crore to the exchequer.

Interestingly, many of the alleged violations of rollout obligations seem to have coincided with the period when chief vigilance commissioner P J Thomas, currently under a cloud after adverse remarks from the Supreme Court, was the DoT secretary and chairman of the Telecom Commission. All these companies received licences in January-February 2008 and spectrum during 2008-2009, so their one-year rollout obligation dates fall between mid-2009 and 2010. Thomas was DoT secretary from 1 October 2009 till he took over as CVC in September 2010.