TDSAT stays Rs 250 cr penalty on Idea

Providing some relief to Idea Cellular, telecom tribunal TDSAT today restrained DoT from enforcing Rs 250 crore penalty on it for alleged violation of rules with regard to five over-lapping licences of Spice Communications.

The Telecom Disputes Settlement and Appellate Tribunal (TDSAT) bench, headed by its Chairman Justice S B Sinha, restrained the Department of Telecom from enforcing the penalty. However, it directed Idea Cellular to supply the relevant documents to DoT.

"We, however, direct Idea to supply copies of documents to the DoT forthwith," the tribunal said adding that non-filing of some documents cannot be a ground for refusing relief to Idea.

Idea acquired Spice Communications in 2008, leading to over-lapping of six licences.

TDSAT further observed that as the matter regarding transfer of licences is expected to be decided by the Delhi High Court by the end of this month, penalty of Rs 250 crore should be stayed.

"We are of the opinion that Idea being not a 'fly by night' company and a huge amount having imposed on it by way of penalty, in the event, an interim order is passed in favour of the petitioner restraining DoT from enforcing its demand, no prejudice would be caused to it," it said.

"The legal position, it is expected, shall stand cleared by reason of the judgement of the Delhi High Court which, we are informed at the bar, may be pronounced in July, 2011," said TDSAT.

Idea Cellular had picked up 41.09% stake in Spice and it resulted in a situation where both the companies held licences in six circles.

The Aditya Birla-promoted firm has maintained that it has not breached any condition of the licence agreement.

Indian telecom laws prohibit a single operator from holding more than one licence in any circle. However, with the lack of clarity in mergers and acquisitions rules, the case has been pending in courts for a long time.

"The interim order has been granted on Idea's plea against DoT's demand notice issued to Idea in June, 2011. Earlier, TDSAT had also ruled against DoT's demand notice to Idea, imposing a penalty of Rs 50 crore for Punjab circle," Idea Cellular said in a statement.