Birla asks Sibal to help resolve Idea Cellular issues

Aditya Birla Group chairman Kumar Mangalam Birla has written to communications minister Kapil Sibal last month seeking his "urgent personal intervention" to resolve several long-pending regulatory problems being experienced by the group's telecom arm Idea Cellular.

Birla wrote to Sibal on 23 May complaining that Idea Cellular, despite being a serious player with 122 million customers, a track record of growth and offering the world's lowest tariffs, was encountering difficulty in multiple areas, including obtaining licences and spectrum in some parts of the country, The Times of India reported.

Birla, who is the chairman of Idea Cellular, pointed out that the company has neither been allotted airwaves it won in last year's auctions nor been permitted to use third-generation (3G) spectrum it had won in Punjab region in the 2010 sale.

He also pointed out that the mobile permits of Spice Communications, which it had acquired in 2008, had not yet been transferred to it despite several court rulings.

The communication adds that Idea had not been allowed to set off Rs484.17 crore, the entry fee paid by Spice, even though the panel of ministers on spectrum had "specifically permitted" this facility.

The missive to Sibal comes at a time the telecom department (DoT) has moved the Delhi High Court to initiate contempt proceedings against Idea Cellular, its chairman and five other top executives of the mobile operator for allegedly violating an earlier court order that barred it from signing up new 3G customers outside its licensed zones.

But Birla's letter makes no mention of this issue.

In his communication, Birla has pointed out that the merger between Idea and Spice had been approved by the high courts of Delhi and Gujarat in 2009. It was subsequently ratified by a single judge of the Delhi High Court in July 2011 and the divisional bench of the same court in 2012. The latter had also directed the government to take an early decision on the transfer of operating mobile permits of Spice in Karnataka and Punjab to Idea.

Birla has told Sibal that the government, earlier this year, had said it was "in principle agreeable to the transfer" of Spice's licences and sought Idea's confirmation on certain points, but had not acted after the company had completed all formalities.

The standoff with the government on the Spice merger has also resulted in the company failing to get 3G spectrum in the Punjab circle.

"The approval for commercial usage of 3G spectrum (in Punjab) has been pending for quite some time. In this regard, we have highlighted that as per terms of the Notice Invite Applications (which contained the rules for the airwaves sale), an entity not having a licence was allowed 3G spectrum subject to entirely obtaining a licence subsequently," his communication added.

Birla also said that Idea was the most active participant in the November 2012 auctions, where it won back permits and airwaves in seven regions and had committed payments of Rs2,031 crore for these airwaves, but was yet to get its licences for these regions.