Telecom Commission, the apex decision-making body in Department of Telecom, has decided to take the views of the Law Ministry on the proposal to demerge surplus land held under VSNL (now Tata Communications) into a new company.

The panel, which has representatives from the Department of Economic Affairs and the Department of Industrial Promotion & Policy, has also decided to seek comments of the Planning Commission.

Surplus land

The DoT had proposed to hive off the surplus land held by VSNL into a separate company in order to unlock the value by selling it. In 2002 VSNL's majority stake was acquired by the Tata Group. But the 773 acres of land, spread over five locations in Delhi, Kolkata, Chennai and Pune, was not part of the deal.

As part of the agreement, the strategic partner (the Tatas) was supposed to facilitate the process. However, the process hit rough weather with Tatas raising a number of issues, including clarity on who will bear the cost of creating the new company. Since then the Government and the Tata Group have been feuding over how to dispose off the land.

Recently, the Communications Minister, Mr Kapil Sibal, asked the Telecom Department to find out why it was taking so long to decide what to do with the land. While the DoT has blamed the Tatas for delaying the process, the Tatas have put the onus on the Government.

More details sought

The Telecom Commission, which met on July 5, could not take a decision on the seven-year-old dispute and has sought more information from the DoT.

The Commission has sought details on ownership of land before VSNL was set up. It has also sought information on whether the Government or Tata Communication can sell the land taking into account the specific purpose for which land as was allocated.

The panel has asked DoT to explain the funding mechanism and viability of the proposed new company into which the surplus land will be transferred.

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