DoT (Department of Telecommunications) had come under fire for its decision to award a unified license to Reliance Jio, but has now retorted that it has not been partial in the way the matter was handled. CAG (Comptroller and Auditor General) indicted DoT for permitting the telecom company in question to acquire pan-India high speed BWA spectrum without actually participating in the auction.
In 2013, a little known company called IBSPL (Infotel Broadband Services Pvt Ltd) successfully bid for nationwide BWA spectrum at a cost of roughly Rs 12750 crores. DoT was accused of having overlooked a loophole which failed to properly define the eligibility criteria set for bidders. In the case of telecom brands, promoters holding 10% in it cannot sell their stake for 3 years after spectrum allocation takes place.
But the same policy was not applicable to the BWA auction, meaning IBSPL did not have any trouble selling itself to Reliance Jio and making a humungous wad of cash amounting to Rs 4800 in profits from the resale. The Mukesh Ambani-led company had an Internet Service Provider (ISP) license for broadband spectrum under which voice telephony was not allowed until DoT rolled out a unified license regime accommodating all kinds of telecom services.
The revisions meant ISPs with broadband spectrum could pay Rs 1,658 crores and begin delivering voice services. Hindu Business Line reports that DoT has not only defended its decisions, but also questioned the CAG’s authority to bring up policy problems not relevant to audit. CAG has been concerned that DoT’s changes to the aforesaid policies may have lost the national exchequer a significant sum in licensing fees.