The Department of Telecom (DoT) is planning to ask Bharti Airtel and Tata Teleservices (TTSL) to collectively pay around Rs 15,000 crore as pending dues relating to licence fees, spectrum usage charge (SUC) and one-time spectrum charge (OTSC) as a pre-condition for clearing their merger, according to a report by The Economic Times.
"Airtel and TTSL have to pay around Rs 10,000 crore and Rs 2,800 crore, respectively, as SUC," a DoT official told the newspaper.
There is another Rs 2,000 crore of OTSC that the transferee firm Airtel will have to pay in the form of bank guarantees to the government, the official said, adding: "Demand letters will be sent shortly."
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The licence fees are getting calculated and that will also be a big amount, which the merging telcos will have to pay, another DoT official told the newspaper.
Moneycontrol independently could not verify the report.
In January, National Company Law Tribunal (NCLT) approved the merger of loss-making telecom firm Tata Teleservices with Bharti Airtel. However, the merger is subject to the approval of the DoT. The Bharti-Tata deal was announced in October 2017.
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According to the DoT guidelines, a telecom operator pays eight percent AGR as licence fee and roughly five percent as SUC. The OTSC dues are based on DoT rules that require a telco holding beyond 6.2 MHz/circle between July 2008 and December 31, 2012, to pay a one-time market-linked price for the excess spectrum held. The telcos are also required to pay the market price for holdings air waves beyond 4.4 MHz/circle between January 2013 and the expiry of their respective licences.
In the past, however, telcos have opposed DoT's efforts to recover annual dues such as SUC and licence fees on the grounds that the definition of adjusted gross revenue (AGR) was still disputed in court.
The DoT is said to be expecting the two operators to legally challenge the OTSC charges.
"The Telecom Disputes Settlements and Appellate Tribunal (TDSAT) recently ordered the telecom department to return bank guarantees worth Rs 2,000 crore to RCom that were given by the operator as OTSC. We expect Airtel to approach the TDSAT as well so that it does not have to pay OTSC," an official told the newspaper.
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The final payment that the department might receive would depend on the rulings of the courts and tribunals as several of these dues (SUC, OTSC, licence fees) are under litigation in different courts involving different parties, an official added.
The DoT had earlier asked the merging companies to clarify who will pay what dues. In October 2018, Airtel and TTSL said in a letter to DoT last the Sunil Mittal-led company would take care of the payments, including licence fee, SUC and OTSC.
However, since Airtel had agreed to buy telecom business of Tata group in a debt-free, cash-free deal, Tata Sons is expected to bankroll most of the dues even if the former formally assumes the responsibility to clear the dues.