Uninor moves SC against DoT's spectrum charge hike

Telecom operator Uninor today approached the Supreme Court challenging the hike in spectrum usage charges by the Department of Telecommunications (DoT), joining Bharti, Vodafone, Idea and Aircel who are opposing it as well.

A Bench headed by the Chief Justice S H Kapadia admitted Uninor's petitions and directed to tag it with similar pleas filed by other telecom operators.

United Wireless, which owns the brand name Uninor, has challenged the order of the sectoral tribunal TDSAT that declined to stay DoT's hike in spectrum usage charge.

On October 22, the Supreme Court had stayed the TDSAT order upholding a hike in 2G telecom spectrum (radio waves) usage charges, but asked telcos Bharti, Vodafone and Idea to deposit with it 50 per cent of the fee.

It had directed Vodafone, Bharti Airtel, Bharti Hexacom (operating in Rajasthan) and Idea Cellular to deposit 50 per cent of the proposed increase in fee with court's registry.

The apex court also asked the telcos to furnish bank guarantees, for the rest 50 per cent liability.

Telecom service providers have to pay a percentage of their adjusted gross revenue (AGR) to the government as spectrum usage charge, which depends on the quantity of radio waves held by the operators.

The new charges vary between 3 and 8 per cent of AGR.

As per new charges, an operator holding spectrum up to 4.4 MHz will have to pay 3 per cent of the AGR compared to two per cent now.

Vodafone had to pay Rs 135 crore and the two Bharti firms have a joint liability of Rs 220 crore on account of enhanced spectrum usage charges.

On September 1, 2010, TDSAT had held that the decision to enhance the charges was taken by DoT after following the proper consultation process of the sectoral regulator Trai and mandatory approvals from the Telecom Commission and Group of Ministers.

Challenging the TDSAT's order, operators have submitted that the tribunal had ignored Trai's recommendation and the charge was increased "without any effective and timely consultation process" and was violative of the Trai Act.

They further submitted that Trai, in its recommendation on May 11, 2010, had disagreed with the enhanced 2G spectrum usage charges fixed by DoT.