The Hindu Business Line : FM licence fee issue back to I&B Ministry

THE Finance Ministry has tossed the issue of deferring payment of the annual licence fee by FM radio companies back to the Information and Broadcasting Ministry and has asked it to take a firm view on the issue.

The I&B Ministry has been unable to take a view on the deferment. With the country going to polls, officials have been of the opinion that extension of the deadline for payment of licence fee was not the best option as it could incur the wrath of the Election Commission. Also, such a decision could require a Cabinet decision. However, the I&B Minister, Mr Ravi Shankar Prasad, had decided to refer the issue to Finance Minister, Mr Jaswant Singh.

However, with the North Block not offering a clear guidance, officials in the I&B Ministry said that the Election Commission would now be consulted. The deadline for payment of the annual licence fee was April 29, with a seven-day grace period and so far none of the licence holders have paid. The Government could stand to lose over Rs 100 crore if it decides to give an extension.

Meanwhile, the I&B Ministry is unlikely to take a harsh step such as encashing the bank guarantees immediately even though the Bombay High Court had last week squashed a petition filed by the Times Group promoted Entertainment Network India Ltd seeking a stay on encashment of these guarantees.

The private FM radio companies such as the Entertainment Network India Ltd, Living Media's Radio Today, Radio Mid Day have all been making representations to the Government about the losses the sector has been incurring. They have also been suggesting a switch from the existing license fee regime to a revenue sharing arrangement.

The Government had appointed a committee chaired by Dr Amit Mitra, Secretary General of the Federation of Indian Chambers of Commerce and Industry, to work out a fresh set of norms for the FM radio sector.