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In relief for telecom, Center ready to reconsider spectrum charges

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Lump-sum spectrum charges are charges that operators have to pay for carrying additional radio waves.

In a major relief to crisis-hit telecom companies, the Center is set to “reconsider” the one-time spectrum fee (OTSC) of Rs 40,000 crore levied on telecom companies. The Department of Telecommunications (DoT) has sought three weeks’ time from the Supreme Court to review its decision to penalize telecom companies – Airtel and Vodafone Idea – for delay in paying one-time spectrum charges.

“The Central Government is inclined to review or reconsider its decision to proceed with the present proceedings of the appeal,” the Center said in an affidavit filed in the apex court. The DoT told the Supreme Court that the Rs 40,000 crore OTSC would add to the financial burden of the telecom companies. Most of the telecom service providers have suffered huge losses and the telecom sector is under stress despite the government’s relief measures.

The Supreme Court, on its part, has agreed to give time to the DoT to reconsider the one-time spectrum charges of Rs 40,000 crore, while saying, “We are not expressing any opinion on the DoT’s move for reconsideration.” The one-time spectrum charge top court will hear the matter again on November 17.

Lump-sum spectrum charges are charges that operators have to pay for keeping radio waves over a specified limit. Bharti Airtel has OTSC dues of Rs 8,414 crore and Vodafone Idea has accumulated OTSC dues of Rs 4,389.8 crore as at the end of March 2021.

The spectrum fee issue dates back to 2012, when the Supreme Court canceled 122 telecom permits and declared airwaves to be distributed through auctions as public goods in the wake of the 2G scam.

Subsequently, the government made it mandatory for all airwaves allocated above 4.4 MHz to charge at the prevailing market rates. Telecom companies were given 4.4 MHz spectrum and pan-India license for Rs 1,658 crore. They were entitled to an additional 1.8 MHz if certain customer-base conditions were met.

In November last year, the government decided that operators holding spectrum above 4.4 MHz would have to pay for the period between January 2013 and the expiry of the licence, and those holding spectrum above 6.2 MHz from July 2008 to January 1, 2013. will have to pay. Based on a market-determined price determined at auction retrospectively.

In a related development, the government had on September 15 unveiled a slew of reforms for the telecom sector. These measures include allowing 100 per cent foreign investment in telecom through the automatic route and a 4-year moratorium for telecom companies to pay their adjusted gross revenue. , spectrum and arrears.

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