The Department of Telecom has decided to recover liquidated damages from new 2G operators that had failed to meet the rollout obligation. The Department has asked its finance wing to encash the bank guarantees deposited by these players immediately as part of recovery mechanism. This compounds the woes of the 2G operators. Not only have their licences been cancelled, the Department is also claiming dues. Those affected include Etisalat DB, Videocon and Sistema Shyam.

The DoT had earlier issued showcause notices to these players for failing to meet rollout obligations. The operators claim that they had met the obligations and had challenged the DoT showcause before the Telecom Dispute Settlement Appellate Tribunal. While the DoT plans to cancel the licences for the rollout failure it also wants to ensure that the money due is recovered. But for that the DoT will have to wait for the final court order. Therefore, it has asked the finance wing to encash the bank guarantees as a first step. Operators had submitted bank guarantees ranging between Rs 2 crore and Rs 20 crore depending on the area of operation while the liquidated damages can go up to a maximum of Rs 14 crore. “It was decided that action may be initiated on priority for recovery of the dues of the department from the licencees whose licences have been cancelled by the Supreme Court,” said an internal DoT note.

tkt@thehindu.co.in

(This article was published on March 20, 2012)
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