Reliance Communications alleges discrimination by govt on spectrum charge

Reliance Communications (RCom) says the department of telecommunications (DoT) discriminated against it for seeking a bank guarantee for one-time spectrum charges (OTSC) from it, whereas no such demand was made from Vodafone, which is merging with Idea Cellular.

According to sources, RCom has written a letter to DoT, wherein the Anil Ambani-owned company cited media reports that conditional approval had been given to the Vodafone-Idea merger without insisting on any bank guarantee (BG) against the pending OTSC of Vodafone. 

In 2015, RCom said, DoT had raised a demand for OTSC when it liberalised the administratively allocated spectrum. The company is now seeking immediate release of the Rs 20-billion bank guarantee it had given to DoT. 

An official in DoT denies the charges. He told Business Standard the two cases were different — RCom was not merging with any company. In its case, spectrum sharing and trading guidelines were applied; in that of Vodafone, merger and acquisition guidelines were implemented. 

RCom said DoT had demanded BG in 2015 despite the matter being a dispute in court. “Not only that, DoT has unilaterally increased the original OTSC demand, without any hearing or process, based on subsequent auction prices,” RCom alleged.

DoT had raised a demand of Rs 39.26 billion in cash for liberalisation of Vodafone spectrum, whereas a BG of Rs 33.22 billion was sought from Idea Cellular as OTSC.

RCom has alleged the OTSC dues of Vodafone are Rs 90 billion. Its letter says TDSAT, the appellate tribunal, had on July 3 directed DoT to return the BG to RCom. Its letter asks the department to do so, without filing any petition at the Supreme Court.