Hc Stays Transfer Of Punjab Cellular Licence To Jt Mobiles

The Delhi High Court has put on hold the transfer of the Punjab cellular licence by JT Mobiles to its subsidiary Evergrowth Telecom by issuing a stay order on the department of telecommunications (DoT)s no-objection letter issued to the company. The stay will be in force until the next hearing in the case fixed for September 26.

At a hearing yesterday, a division bench of the court also served notices on the department and JT Mobiles asking why the writ petition of Parasrampuria Credit & Investment Ltd (PCIL) challenging the DoTs no-objection letter should not be admitted. The notices are returnable by September 26.

Last month, a single-judge bench of the Delhi High Court had quashed a PCIL petition challenging DoTs no-objection letter on the ground that transfer of the Punjab licence violated Clause 10 of the licence agreement. The court dubbed the petition premature, saying that the letter had not yet become effective.

Yesterdays hearing was on a fresh petition filed before the division bench by PCIL seeking a review of the earlier order on the ground that certain points were not raised during the earlier hearings.

The court took cognisance of a recent proposal put forth by JT Mobiles to settle out of court with DoT under which it proposed to deposit Rs 5 crore towards the licence fee by December 31 and sought that the no-objection letter to operation of the Punjab licence through Evergrowth be made effective. It also demanded that the department immediately provide interconnectivity to Evergrowth. The company has claimed that all the seven conditions laid down in the letter have been fulfilled.

Evergrowth had been allowed by DoT, through a letter dated April 18, 1996, to provide cellular services in Punjab on behalf of the parent company, which also holds the cellular licences for Karnataka and Bangalore. The DoT letter had laid down as one of the conditions that Evergrowth will have to remain a 100 per cent-owned subsidiary of JT Mobiles. However, JT Mobiles has sought the telecom secretarys permission to transfer 49 per cent equity in Evergrowth to the Ruias of the Essar group.

DoT had earlier served a show-cause notice on JT Mobiles following reports that it had offloaded 76 per cent of Evergrowth equity to the Ruias.

PCIL is entangled in an ownership dispute with R K Associates