License fee to be based only on telecom services

In a major relief to telecom companies, TDSAT today said revenues arising only from telecom services should be included in the gross revenue of a company for the purpose of levying licence fee.

It also remanded telecom regulator TRAI only to determine to the extent of various components of adjusted gross revenue bearing in mind the finding of the TDSAT relating to non-licensed activities.

When contacted, Ramji Srinivasan, a renowned telecom lawyer and appearing on behalf of the industry, contended that government could recover license fee only from the telecom activities licensed under Section-IV of the Indian Telegraph Act.

TRAI has been asked to give report within 3 months and also directed that a public hearing should be given to all telecom companies.

The decision to levy license fee only on the telecom services would enable the operators to offer many more promotional schemes especially bundling of handsets among other schemes.

According to some analysts this could result in a saving of up to Rs 300 crore annually and the same benefit could be passed on to consumers in terms of lowering tariffs.