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DoT moves SC against merger of Airtel with Tata Tele arm

DoT has sought dues worth over Rs 8,000 crore on account of one-time spectrum charges (OTSC) and said in its appeal to the apex court that the demand was based on the licence conditions, said people aware of the developments. The appeal was filed ...

, ET Bureau|
Nov 12, 2019, 07.35 AM IST
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Agencies
Airtel
While Airtel had paid the required amount and announced the completion of the merger in July, DoT did not give a formal approval.
The department of telecommunications (DoT) has moved the Supreme Court against the telecom tribunal’s decision that mandated it to clear the merger deal between Bharti Airtel and the consumer mobility business of Tata Teleservices.

DoT has sought dues worth over Rs 8,000 crore on account of one-time spectrum charges (OTSC) and said in its appeal to the apex court that the demand was based on the licence conditions, said people aware of the developments. The appeal was filed last week and hearing has been set for November 15.

The Telecom Disputes Settlement and Appellate Tribunal (TDSAT) had in May partially stayed DoT’s demand for about Rs 8,300 crore in bank guarantee on OTSC, citing that similar orders in merger cases in the telecom industry by various courts, including the Bombay High Court.

The tribunal had asked DoT to take on record the merger of Bharti Airtel and Bharti Hexacom with de-merged undertaking of Tata Teleservices. It had asked Airtel to submit half of the Rs 1,287.97-crore demand raised by DoT as OTSC for the Chennai circle licence extension from November 30, 2014 to September 27, 2021within four weeks. It also allowed the merging companies to “operationalise the spectrum and undertake other consequential activities”.

While Airtel had paid the required amount and announced the completion of the merger in July, DoT did not give a formal approval.

In fact, DoT has recently directed all circle heads to treat Bharti Airtel and Tata Teleservices as separate entities and to deal with customer acquisition process and all compliance-related issues of the two companies separately.

As part of the agreement signed between Airtel and the Tata Group company in October 2017, Airtel was to absorb the telco’s consumer mobile operations in 19 circles — 17 under Tata Teleservices and two under Tata Teleservices (Maharashtra). As part of the proposed agreement, Airtel was also to take over a small portion of the unpaid spectrum liability of Tata Teleservices.

The Sunil Mittal-led telco will get an additional 178.5 MHz of spectrum in three bands — 1800 MHz, 2100 MHz and 850 MHz — that are widely used for 4G, an area where Airtel is expanding fast to keep pace with Reliance Jio Infocomm.

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