The auction of spectrum for 3G telephony is likely to get delayed again as the law ministry has suggested the auction be done only after availability of spectrum, which would otherwise create legal complications.
The auction process was earlier scheduled to begin on January 14, but got delayed due to uncertainity over the number of slots and unavailability of spectrum.
The suggestion by the ministry might have been prompted by the advice of the legal advisor of the Department of Telecommunications (DoT), who said the 3G auction should be conducted for only those slots where spectrum can be allotted by September this year, as the government might lose huge amounts of revenue if the deadline of assigning spectrum is not kept, a senior ministry official said.
DoT had sent the draft notice inviting applications for 3G to the law ministry for approval.
The government plans to take the upfront payment for auction of 3G spectrum within 15 days of the completion of the process, which may create legal hurdles as spectrum would be available by the September 1 this year, according to the law ministry. The winners in the auction may ask for compensation or can go to court if the government is unable to allot the spectrum on time.
However, a final decision would be taken by the Empowered Group of Ministers (EGoM) headed by Finance Minister Pranab Mukherjee. If EGoM accepts the law ministry’s suggestion, then the 3G auction may happen in September, provided the defence ministry releases spectrum by that time, people close to the development have said.
DoT has enough spectrum to auction two slots of 3G spectrum, while spectrum for the third slot would be available by September. The defence ministry would vacate the fourth slot by 2013.