Apex court may get to decide on asset transfer to Telenor's new India arm

Sibal had given a go-ahead to Telenor for transferring its assets from Unitech Wireless to Telewings in May this year

The proposed business transfer from Unitech Wireless, the earlier joint venture of Norway-based telco Telenor, to Telewings Communications, Telenor’s new Indian unit, is likely to be placed before the Supreme Court.

A decision to this effect was taken at a recent discussion between the law secretary and the Communications and Information Technology Minister Kapil Sibal, also the law minister. Any direction passed by the apex court should be complied with, it was decided. The law secretary has also sought the opinion of the department of telecom (DoT) for reconsideration by the Department of Legal Affairs.

Sibal had given the go-ahead to Telenor for transferring its assets from Unitech Wireless to Telewings in May this year. DoT has, however, sought legal opinion from the law ministry on the proposed asset transfer from Unitech Wireless to Telewings.

Telenor did not respond to Business Standard’s queries.

The Norwegian company had entered India in 2009 through a joint venture with real estate giant Unitech Group, where it had a 67.25 per cent stake. However, the two firms parted ways after the Unitech managing director came under the scrutiny of the Central Bureau of Investigation (CBI) in the 2G scam. The company also lost all its operating permits due to a Supreme Court order that cancelled 122 licences issued in 2008.

Telenor had then bought back Unitech’s stake in the joint venture and formed a new venture, Telewings Communications, in which Mumbai-based Lakshdeep Investments & Finance holds a 26 per cent stake. In the November 2012 auction, Telenor won six licences through Telewings, which was required to pay Rs 4,018 crore in instalments. It made a 33 per cent upfront payment of Rs 1,326 crore and made a representation, requesting DoT to set off the entry fee of Rs 1,658 crore paid by the eight companies of Uninor.

First,  DoT approached the corporate affairs ministry to examine the transfer for compliance with the Companies Act. However, the ministry declined the request saying the matter was outside its ambit.

Last year, DoT, in an affidavit on the status of participation in the auctions, stated that Unitech’s business is in process of transfer to Telewings.