SC notice to 11 telcos for not rolling out 2G services

The Supreme Court today issued notices to the Telecom Regulatory Authority of India (Trai) and 11 companies which had allegedly not rolled out their services despite getting licences in 2008.

The companies include Ideal Cellular, Tata Teleservices, Vodafone Essar South Ltd, S Tel Ltd, Sistema Shyam Tele Services, Unitech Wireless Group, Loop Telecom and Videocon Telecommunications. The apex court has also issued notices to the central government and the Department of Telecommunication.

The court order stated that it was doing so since Trai had sent a letter dated November 15, 2010 to the DoT secretary, which indicated that many companies had not complied with the roll-out obligation and not started the services.

The Bench consisting of Justice G S Singhvi and Justice A K Ganguly passed the order on a petition moved by the Centre for Public Interest Petition seeking the cancellation of licences granted to companies during the tenure of former communications minister A Raja.

The judges remarked that not rolling out the services was a “serious matter”, affecting public interest and consumers. They wondered why Trai did not take action against the companies. “Trai is treated as the highest regulatory authority in the telecom sector and even in terms of the consumer. What was it doing?” the judges asked.

Prashant Bhushan, counsel for the petitioner-NGO, stated that Trai did not do anything in the past two years and the government conducted CBI raids last month merely to show that it was doing something. The new communications minister has come out with an argument that the government had not suffered any loss though CAG has put it otherwise.

The judges observed that they could not take cognisance of the minister’s statement which has made the issue “debatable”. They would also not go by the media reports.

The court allowed Janata Party president Subramanian Swamy, who has filed a separate petition for cancellation of all 122 licences, to implead the 11 companies as parties in his case. Swamy also wanted to restrain the government from regularising the licences after imposing small fines on the companies. The court will hear the cases on February 1.

Earlier, Bhushan told the court that there were five main grounds for cancellation of licences to the companies. The most important is the findings of the Delhi High Court that the cut-off date was arbitrarily and illegally changed by the ministry in January 2008 with retrospective effect from October 1 to September 25, 2007, ousting two-thirds of the applicants from the bidding process.