BANGALORE: The Union cabinet has approved a proposal for extending the
deadline for payment of license fee dues of basic and cellular mobile operators
from January 31, 2000 to March 15, 2000 and has asked defaulting companies to
furnish a bank guarantee for the entire outstanding amount and interest by the
end of this month.
Licensees should pay, along with the furnished bank guarantee, cash penalty
of 2 per cent per month on the short-fall of securitisation up to the date of
furnishing the bank guarantee, on proportionate basis for the number of days of
delay beyond December 31, 1999. In case the licensee clears the entire
outstanding dues on or before February 29, without furnishing any bank
guarantee, there will not be need to provide a bank guarantee any more. However,
the cash penalty of 2 per cent per month for not furnishing the bank guarantee
for the period starting from January 1, 2000 will have to be paid. The cabinet
also approved a proposal to allow licensees to pay the entire outstandings by
March 15, along with interest as per the license agreement, and additional
simple interest of 3 per cent per month for the period February 1 to March 3, on
a proportionate basis.
It may be noted that the Union finance ministry earlier reported to have
objected to extend the deadline when the Department of Telecommunications (DoT)
forwarded such a plea from the private telecom operators. After the cabinet
meeting, Information Technology minister Pramod Mahajan said all phone companies
will have to pay an additional simple interest of 3 per cent per month for the
period between February 1 and March 15.
The companies, however, have to give a suitable undertaking on affidavit for
being eligible for such extension, Mr Mahajan said. If telecom operators fail to
meet the above conditions, the government can withdraw the migration package -
from high up front license fee regime to revenue sharing formula - offered to
them without any further notice, the Minister said.
Sources said that the finance ministry was opposed to grant of extension and
had, in fact, suggested cancellation of licenses of the defaulting companies.
The cabinet said that failing to furnish the conditions approved by it, the
defaulters will be liable to automatic withdrawal from the migration scheme
without any further notice. Further, the government can take such legal remedies
as are open to it.