Jul 08, 2013, 09.43 AM IST | Source: PTI

DoT against another chance to Airtel on Rs 650 crore penalt

The DoT is against giving another chance to Bharti Airtelon the Rs 650-crore penalty issue even as the company has sought a personal hearing from Telecom Minister Kapil Sibal on the matter.

DoT against another chance to Airtel on Rs 650 crore penalt

The DoT is learnt to be against giving another chance to Bharti Airtel on the Rs 650-crore penalty issue even as the company has sought a personal hearing from telecom minister Kapil Sibal on the matter.

"As regards, representation of Bharti Airtel, the issue has been examined by DoT, TRAI also. Therefore, further opportunity again is not a desirable proposition...

"It is suggested that all the orders for imposing penalty for all 13 service areas may be issued without further delay," sources quoted the concerned DoT official as mentioning in an internal note

When contacted, an Airtel spokesperson declined to comment on the matter.

It may be recalled that Bharti Airtel's joint managing director and CEO, Gopal Vittal earlier in a letter had said the company should be given an opportunity to explain its position.

"...There has been no violation and that we are in full compliance of the licence terms...an early opportunity of personal hearing is given to us to represent our case before any final decision is taken by DoT on this issue," Vittal said in a letter.

On July 24, telecom minister Kapil Sibal was understood to have approved levying of Rs 650 crore penalty on Bharti Airtel for violating roaming norms in 13 service areas between 2003 and 2005 (at the rate of Rs 50 crore per service area).

DoT said it had found Bharti Airtel routing national and international calls as local calls (SLD) under a scheme till 2005 despite being told to stop it in 2003, and that it caused loss to the government exchequer and state-run Bharat Sanchar Nigam Ltd (BSNL) across 13 service areas.

The operator had not stopped the service at least up to June 2005 even after specific directions from the DoT was issued on June 20, 2003, sources said.

Bharti Airtel has claimed that DoT made no effective communication with it on this issue since 2005.

It further said that penalty on company are proposed after long delay of 8 years and "as a result of delay we are likely to be seriously affected in our ability to produce or lead evidence which may also be no longer in existence to establish our case."

In a separate note, industry representatives have asked DoT to work on rationalisation of penalty on telecom players instead of the current practice of imposing maximum penalty of Rs 50 crore fine without assessing magnitude of damage caused by the violation.
Industry estimates that the total penalty on companies in the sector are to the tune of Rs 6,500 crore.

Bharti Airtel stock price

On July 22, 2014, Bharti Airtel closed at Rs 353.25, up Rs 16.20, or 4.81 percent. The 52-week high of the share was Rs 373.50 and the 52-week low was Rs 279.25.


The company's trailing 12-month (TTM) EPS was at Rs 16.51 per share as per the quarter ended March 2014. The stock's price-to-earnings (P/E) ratio was 21.4. The latest book value of the company is Rs 152.21 per share. At current value, the price-to-book value of the company is 2.32.

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