The Department of Telecom will ask Ministry of Corporate Affairs to examine a five-year dispute between the Tatas and the Aditya Birla Group over Idea Cellular. DoT wants the MCA to check if Tata Sons held more than 10 per cent stake in Idea Cellular and Tata Teleservices Ltd at the same time.

The issue dates back to 2006 when the Tata Group exited Idea Cellular by selling their 48 per cent stake in that company to the Aditya Birla Group. The Tatas had to exit Idea Cellular after the Birlas complained that the former was violating the cross-holding norms by holding equity stake in two different telecom companies.

According to DoT's rules, a single entity cannot hold more than 10 per cent stake in two companies operating services in the same circle. Both Idea Cellular and Tata Teleservices had overlapping service areas but the Tatas had maintained that there are no common promoters in the two ventures with more than 10 per cent stake. The Tatas have stated that the entire argument of the Aditya Birla group was baseless as it relied on the premise that all Tata companies should be treated as a single group and not as individual companies.

According to DoT's findings, Tata Sons was holding 50.95 per cent stake in Tata Teleservices. Tata Sons was also holding 28.69 per cent equity in Tata Industries Ltd, which in turn was holding 31.69 per cent in Idea Cellular. Tata Industries was holding 100 per cent stake in Apex Investment (Mauritius), which in turn held 16.45 per cent stake in Idea Cellular.

DoT had earlier sought the opinion of the Law Ministry in the matter. The Law Ministry has told the department that since the issue was related to equity holding, the case may be referred to the Ministry of Corporate Affairs. This comes even as both companies are locked in arbitration as directed by the Supreme Court.

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