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Telcos set to go to HC over 'illegal' towers

Surajeet Das Gupta & Mansi Taneja  |  New Delhi 

Question mark on 70% of towers on buildings in India

With over 70 per cent of the towers erected on residential or commercial buildings in the country being “illegal” and under threat of getting sealed any time, the Cellular Operators Association of India is set to go to the Allahabad High Court for protection against such action and to demand uniform rules for erecting these across the country.

The towers are often illegal because buildings do not have occupancy certificates from local authorities, which could jeopardize the thousands of crores of rupees invested in such infrastructure.

The move comes after the Uttar Pradesh government sealed over 200 towers at Noida, near here, last week. It led to major disruption in mobile services. The towers were ordered sealed on issues with buildings and since they did not have the necessary permission from resident welfare associations, a prerequisite under the rules.

Around 25-30 per cent of the 250,000 towers in the country are predominantly in urban areas and major cities. In cities like Delhi, only 10 per cent of homes have occupancy certificates. Based on existing acquisition deals, these towers are cumulatively valued at Rs 25,000 crore.

Lawyers representing the operators, however, say that under the Indian Telegraph Act, local authorities do not have jurisdiction on making rules for erection of towers. This vests entirely with the Union government.

Says Shailesh Kapoor, lawyer, who is representing the telecom operators: “The IT Act provides a complete code for establishment and regulation of ‘Telegraph’ (which includes establishment of towers) and the state or local authorities have no jurisdiction to make additional laws about it.”

Kapoor says local authorities have a misconception that tower infrastructure comes under ‘land and buildings’, a state subject in the Constitution. Instead, these come under the category of ‘telegraph’ and only the Centre has the right to make laws on it.

The Department of Telecommunications already has a standing advisory committee for frequency allocation to which companies have to apply for permission and follow its rules and specifications. The committee has members from various departments, which include airports and defence.

Tower companies say the issue is escalating all across the country. Says a senior executive of Mumbai-based GTL Infrastructure, one of the leading independent operators in the country: “The problem is growing. Earlier, it was restricted to Maharashtra, especially Pune. Now, it is in Noida and Delhi. There is no common rule for the entire country on permissions required for erection of towers, though we are a nationwide service. Local authorities are imposing different rules in different areas.”

The Telecom Regulatory Authority of India (Trai), taking cognisance of the growing problem, has planned a consultation paper, with specifications on towers and their radiation and how to reduce their numbers with new A Trai official said: “We have received a primary feedback from operators on tower-related issues and will come out with a paper. But, the process will take a few months.”

However, telecom analysts say they do not expect valuations of companies to get impacted. Ernst & Young telecom analyst Prashant Singal says, “There will be some incremental cost for compliance of any new guidelines which comes in, including shifting of the tower. However, we don’t think it would really have a significant impact on valuations in the long term.”

Industry executives point out that local authorities are asking them to pay an advance deposit to get a no objection certificate (NOC), with the assurance that they will give the certificate after construction on the tower is completed. “Then they do not give the NOC and say we have violated various rules, so we have to go to local courts and take a stay against an order to seal the tower,” says a senior executive of a leading tower company.

He also adds that arbitrary rules have been imposed on tower companies. For instance, in Pune, local authorities charge a tower tax if the structure is higher than a stipulated height. They are also threatening house owners with notices, saying that as they are using their residences for commercial purposes, they should now pay commercial tax on the property which is manifold higher.

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First Published: Sat, February 06 2010. 01:04 IST