Tata Tele can retain its GSM permits, RCom gets relief too

Tata Teleservices has got a major shot in the arm. It is now official that only 122 telecom permits were cancelled by the SC in 2012 and not 141, as claimed by the GSM industry lobby group COAI and other industry associations. According to sources, Telecom Minister Kapil Sibal has accepted legal opinion given by senior advocate P P Rao which says that the 19 GSM licenses of Tata Tele are not affected by the SC order. The company was offering GSM services in all telecom circles of the country except the North East, Jammu & Kashmir and Assam.

Reliance Communications would be an unintended beneficiary of Sibal’s acceptance of this position on cancelled licenses. Had the legal opinion clarified that all dual technology permits issued were also to be cancelled, then RCom’s 21 dual technology licenses would also have become a casualty in the process. So in one stroke, Sibal had provided relief to two CDMA telcos, Tata Tele and RCom.

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As per a communication by Rao, which has been reviewed by Firstpost, there were two sets of applicants for telecom licenses in 2007 and 2008. The first set was that of companies which applied for UAS licences till September 25, 2007, and the second of existing licensees seeking approval to use dual-technology spectrum.

According to Rao, in the first case it was a grant of permits but in the second merely permission to use dual technology. He says the 2012 SC judgment makes no mention of cancelling the permits for use of dual-technology spectrum to the existing players, who had licenses even before the issuance of two press released on January 10, 2008. This is what clears the air for Tata Tele and RCom.

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Rao says the allocation of spectrum quashed by the Supreme Court was limited to the cancelled licences. The existing licensees were not to be affected, as neither their licences were cancelled nor their spectrum quashed.

Not only did COAI actively lobby against Tatas retaining their dual technology permits, several other industry lobby groups also joined the COAI in registering their protests. All of them now have their answer. Rao’s communication clearly says “The interpretation of various groups including Assocham, Telecom Users’ Group, Cellular Operators Association of India and the Managing Director of Idea Cellular (Himanshu Kapania) of the judgement of 02.02.2012 of the Honourable Supreme Court stating that 141 UAS licenses ought to have been cancelled and not 122 licenses as stated in TRAI recommendations is not correct……the allocation of spectrum cancelled by the Supreme Court is limited to licenese quashed. The existing licensees are not affected at all as neither their licenses were cancelled nor spectrum allocated was quashed”.

The Department of Telecom is now in the process of sending out a communication to all those industry associations which represented against Tata Tele retaining its GSM licenses, informing them of the legal position. The same is also being communicated to the two affected companies and the CDMA lobby group AUSPI.