DoT may move to Supreme Court against Airtel and Tata Tele merger
The Department of Telecommunications (DoT) is likely to move the Supreme Court next month, against the telecom tribunal’s decision that mandated it to clear the merger deal between Bharti Airtel and Tata Teleservices, a move which could further delay the closure of the transaction.
As part of the agreement signed in October 2017, Airtel will absorb the Tata Tele’s consumer mobile operations in 19 circles.
- People aware of the thinking at the department said that DoT wants to safeguard its financial interests.
- Dues worth over Rs 8,000 crore on account of one-time spectrum charges (OTSC) are yet to be recovered from the companies.
- “The appeal is likely to be filed in July, once the courts open,” one of the people said.
- The tribunal had asked Airtel to submit half of the Rs 1,287.97 crore demand raised by DoT as OTSC for Chennai circle licence extension from November 30, 2014, to September 27, 2021, within four weeks.
- Airtel had submitted Rs 644 crore, as directed by the court, the approval is still awaited for the deal that was announced back in October 2017.
- Airtel will also add about 13 million of Tata Tele’s subscribers as of April 2019 to its nearly 322 million users, most of Tata Tele’s mobile users are inactive, as per the regulator.
DoT has taken similar steps in the past as well
The DoT has taken similar legal steps in the past also. In May last year, DoT had moved the apex court against a telecom tribunal decision directing the department to clear Airtel’s buyout of Norwegian telecom company Telenor’s India operations, without providing a bank guarantee of Rs 1,499 crore. The court ruled in favour of the companies, a person aware of the matter said.
In Tata Tele’s case, Telecom Disputes Settlement and Appellate Tribunal (TDSAT) had last month partially stayed DoT’s demand for about Rs 8,300 crore in bank guarantees in one-time spectrum charges (OTSC) on the grounds that similar demands have been stayed in other merger cases in the industry by courts, including the Bombay High Court.