Vodafone India has dragged the Department of Telecom to court on the issue of licence extension. DoT had turned down the mobile operator’s request to extend its 20-year-old licences in three circles — Delhi, Mumbai and Kolkata — by another ten years. The licences, issued in 1994, expire in 2014.
Terming DoT’s decision arbitrary, the mobile operator said: “Vodafone is constrained to take legal recourse by challenging DoT’s arbitrary rejection of its extension applications as this matter can potentially cause grave inconvenience to millions of customers in these three circles.”
The company had sought extensions under Clause 4.1 of the licence agreement, which states that the validity could be extended by another 10 years on mutually agreed terms.
Govt prerogative
However, the DoT has taken a view that the licence rules clearly state that it is the Government’s prerogative to decide whether or not to extend the licence period. The Department told the operator to buy back spectrum through the auction mechanism if it wanted to continue operations beyond the 20-year period. Similar directions have been issued to other players, including Bharti Airtel. Vodafone India has invested more than Rs 1,900 crore in the Kolkata circle, where it had 43 lakh users as of October. Its total investments in the Delhi circle, where it has over 87 lakh users, are more than Rs 6,000 crore. It has invested over Rs 6,000 crore in the Mumbai circle, where it has 61 lakh subscribers.
The company said the DoT had gone back on its earlier decision of February 15, 2012, when it had said the validity of existing mobile licences may be extended for another 10 years. Vodafone said that it was willing to pay a fair and reasonable price for the extension of its licences.
Huge investment
“We have already invested thousands of crores to build a countrywide network and services for millions of customers on the basis of trust that the Government, as a sovereign entity, adheres to principles of equity and fair-play and acts in good faith for public good and in larger public interest,” the company said.