2G auction: SC sets Aug 31 deadline

NEW DELHI, INDIA: Rejecting the Centre's plea for allowing 400 days to complete the auction, the Supreme Court on Tuesday extended the deadline for auction and issue of new licences for the 2G spectrum till August 31, 2012.

The apex court, however, said the 122 cancelled licences, however, will stay in operation till September 7, 2012.

The Supreme Court said, "the entire exercise would have been avoided if little effort was made earlier. A fact has been brought to our notice that Rs 7800 crores were lost on each licence."

"We are still not in position to believe that officers of the DoT (Department of Telecommunications) are so naive that they overlooked all this. So we are not in a position to accept 400 days of extension," the court added.

This comes  after the Telecom Regulatory Authority of India proposed a steep hike in base price for auctioning of the spectrum. TRAI has proposed pan India reserve pricing per MHz for 1800 MHz at Rs. 3,622.18 crore, for 800/900 MHz at Rs. 7,244.36 crore, for 700 MHz at Rs. 14,488.72 crore, for 2100 MHz at 3,773.24 crore, an 2300 MHz at Rs. 723.52 crore. The process, it said, should be phased out over a period of three years.

In the present scenario, the operators will have to pay Rs. 18,111 crore for a pan India licence in 1800 MHz to get 5 MHz. So the operators are paying a price premium of ten times vis-a-vis 2008 price point.

However, TRAI said the high pricing is justified because the spectrum can be used for services like 2G, 3G, etc.