DoT says Etisalat DB owes Rs 1,001 crore, no amount due: report

The Indian unit of UAE-based telecom company Etisalat owes Rs 1,001 crore to the government, while no amount is due to the company as claimed by it, according to officials of the Department of Telecom.

According to sources, DoT has informed India-UAE High Level task force on investments of its position on the issue.

"Regarding licence return, it appears that the term has been used for entry fees. As per licence agreement, the entry fee is non-refundable," a DoT official is learnt to have said at the meeting.

DoT, however, has sought legal opinion on the matter, the sources said.

United Arab Emirates' government-run Etisalat held a 44.7 per cent stake in Indian telecom operator Swan Telecom (renamed Etisalat DB). All its permits were part of the 122 licences that were cancelled by the Supreme Court in February 2012 in the 2G spectrum allocation case.

The company has demanded refund of the entry fee it paid for the Indian entity and release of bank guarantees that it submitted for the licences.

However, an official source said, "There are certain licence fees and other dues that company has to pay to DoT. As such, DoT is not liable to pay any amount in respect of these licences. The outstanding amount due on Etisalat DB is Rs 1,001.16 crore."

Etisalat did not immediately respond to the queries on the issue.

Etisalat DB had licences for 13 service areas and merged Allianz Infratech with it which had licences for Bihar and

Madhya Pradesh. The merger was however not approved by DoT.

Following telecom tribunal TDSAT's order, DoT said that it has returned bank guarantees of the company submitted for 11 out of 13 service areas and for rest of the service the matter is sub-judice.

As per DoT, the company closed operations even before its licences were cancelled or surrendered and government for this reason imposed financial penalty of Rs 650 crore for 13 service area where it had permits.

"As Etisalat DB owes Rs 1,001.16 crore to the government, DoT intends to become intervenor in Debt recovery Tribunal-II, Delhi," said the source.

The sources added that Etisalat DB's winding up process is pending before the Bombay High Court and Debt Recovery Tribunal.

Following the Supreme Court order, DoT has worked out a one-time spectrum charge of over Rs 2,060 crore to be levied from operators for the period they remained in business after their licences were cancelled in February last year.

As per DoT calculations, Etisalat DB is liable to pay Rs 94.19 crore in this case.

Etisalat DB had permit to operate in Andhra Pradesh, Delhi, Gujarat, Haryana, Karnataka, Kerala, Maharashtra, Mumbai, Punjab, Rajasthan, Tamil Nadu, UP East and West.

The company had around 16 lakhs subscribers on its network when it closed it operations.

On February 9, 2012 Emirates Telecommunications Corp (Etisalat) had also written off about $820 million in value of its Indian operations by way of an impairment charge as an after effect of Supreme Court order.