Cellular Operators Association of India (COAI) said the Cabinet’s decision to levy a one-time fee on spectrum violates the licence conditions.
COAI, which represents the interest of incumbent GSM players, also said that the decision runs contrary to the Government’s affirmations accepted in both houses of the Parliament, that all spectrum granted to the operators was as per the applicable Government guidelines from time to time and is appropriately charged through spectrum usage fees.
“The one-time charge decision is expected to impact the industry with an additional financial burden of Rs 30,000 crore, which eventually, will be passed on to the consumers in the form of increased prices,” said Mr Rajan Mathews, Director General, COAI. Mr Mathews said the decision has been made without giving due consideration to the effect it would have on the subscriber, and without considering the diminishing finances of the cellular services industry, one of the most heavily taxed segments
COAI said that a report placed on the Department of Telecom’s Web site clearly demonstrates the decision-making process through which the Government decided to charge for spectrum beyond 6.2MHz on revenue share basis instead of a one-time fee. “Now, the Government has done a U-turn and decided to burden the industry with both the revenue share as well as the levy of one-time fee,” he said.