The Supreme Court today allowed telecom companies, whose licences were cancelled last year in February, to continue operation till February 4, the next date of hearing of the case.
The telecommunications ministry had argued before the court that allowing the carriers to operate until the next airwave auction, due in March, will help generate more interest in the auction after the government failed to sell all available spectrum in an auction last November.
Monday's court order will help Russian conglomerate Sistema's Indian unit to continue operations beyond a January 18 deadline in the 21 services areas where its permits are to be revoked. It would also allow Telenor's Indian unit to continue services in Mumbai.
The Supreme Court has also asked the government to inform it about the reserve price of spectrum for the upcoming auction on March 11.
After the court cancelled 122 telecom licences in February 2012, it allowed affected operators to operate for four months. On November 27, the court said all operators that continued services beyond four months after licences were cancelled will have to pay an additional sum, but did not specify an amount.
Fresh auctions across telecom circles in India were held on November 12 and 14 last year. Only 55 per cent of the GSM spectrum on offer was bid for in the auction. Only five players participated in the auction of GSM spectrum, while the auction for CDMA airwaves was called off after the two interested companies - Tata Teleservices and Videocon - pulled out. The high base price of Rs. 14,000 crore was cited as the main reason for poor response from telcos. Two key circles - Delhi and Mumbai - saw no bidders.
Post this poor response, the empowered group of ministers, led by Finance Minister P. Chidambaram, decided to hold a second auction of the airwaves in March.
Airwaves in the 1800MHz and the 900MHz bandwidth of the GSM spectrum will be auctioned first, followed by the auction of the CDMA airwaves in the 800 MHz bandwidth.
In a bid to attract bidders for the CDMA airwaves-which saw no bidding in the November auction since all interested parties had pulled out-the panel has recommended lowering the base price of the spectrum by 30-50 per cent.
The final decision on the reserve price will be taken by the Union Cabinet.
With inputs from Reuters
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