April 10, 2012 / 10:49 IST
Loop Telecom will close down its operations and seek a Rs 3,800 crore refund from the government, the Mint newspaper reported on Tuesday, in the latest corporate fallout from a multi-billion dollar corruption scandal.
The Supreme Court in February ordered cancellation of 122 telecoms licences held by eight operators, including that of Loop Telecom, because of alleged irregularities in the way they were awarded in 2008.A state auditor estimated New Delhi may have lost as much as USD 34 billion as the permits were given out at "unbelievably low" prices.Loop will cease operations on May 15 and has demanded the government refund its license fees plus interest, compensation charges and bank guarantees, Mint reported, citing a letter to the government signed by the company's managing director.The move would affect only 6,000 subscribers and would not impact Loop Mobile India Ltd, an associate that runs mobile services in the city of Mumbai, the newspaper added.Loop Telecom could not be reached by Reuters for comment. A spokeswoman for Loop Mobile said that Loop Telecom would respect the decision of the Supreme Court.Loop would be the third casualty of the scandal and subsequent investigation, after Abu Dhabi's Etisalat said it would shut down its Indian operation and Bahrain's Batelco , whose Indian joint venture is set to lose all its six licences, agreed to sell its 43% stake. Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
