India’s opaque mobile phone companies

Six telcos slapped with demand notice of Rs 100 crore each to reclaim dues

GN Bureau | August 13, 2016


#telecom service providers   #KV Thomas   #CAG   #PAC   #public accounts committee   #Telecom   #Ravi Shankar Prasad  

Facing a loss pegged at  Rs 12,488 crore by the CAG due to under-reporting of revenue by telecom service providers, the department of telecommunications (DoT) has initiated phase-wise process of recovery. The department has sent a demand notice of Rs 100 crore each to six telecom operators – Airtel, Reliance Communications, Vodafone, Idea, Tata and Aircel – to reclaim the initial instalment of dues to the government for the year 2008-09. The DoT will issue  a second set of notices pertaining to the dues for the year 2006-07 towards end of July.

According to a CAG report titled ‘Sharing of revenue by private telecom service providers during the years 2006-07 to 2009-10’, the six major telecom service providers understated their revenue by Rs 46,000 crore, depriving the government of a total revenue of Rs 12,488.93 crore. The report was tabled in parliament in March. 

The public accounts committee (PAC), which is examining the CAG report, called a meeting of all six telcos and representatives of the DoT. PAC chairman KV Thomas told the media that the telcos offered to have an out of court settlement. The offer, however, was rejected by the DoT.
After the CAG report, the government had ordered a special audit of telcos for the period 2008-11. This triggered a political blame game between the Congress and the BJP, with former accusing the latter of covering up a “telecom scam”.

Taking on the government, Congress chief spokesman Randeep Surjewala, accused it of brushing the ‘telecom scam’ under the carpet. “PM Modi who used to say ‘na khaoonga, na khaane doonga’ yet again [made] another false promise.”
He alleged that the government is “surreptitiously taking steps” to protect the interests of six leading telecom companies by helping them avoid the payment of charges rightfully owed to the government.

Union minister Ravi Shankar Prasad, however, said it related to the period when the UPA was in power.
“Congress needs to understand that there is no underreporting case under the NDA government. It is a case of sin of the Congress-led UPA government,” the minister said.

The CAG in its report said, “The government of India was deprived of a total revenue of Rs 12,488.93 crore on account of short/non-payment of licence fee (Rs 3,752.37 crore), spectrum usage charges (Rs 1,460.23 crore) and interest (Rs 7,276.33 crore) due from the six private telecom service providers for the years 2006-07 to 2009-10.”

According to the CAG report, Airtel owes Rs 2,651.89 crore (third highest among the six telcos) to the government. Reliance owes Rs 3,728.54 crore to the government – this is the highest non-payment of revenue by a telco. Tata owes Rs 3,215.39 crore to the government.

Justifying the delay in sending demand notices to the telcos, the DoT said that the auditor tabled the report in March but the details were shared with the department only in June. “The department received the key documents scrutinised by the CAG in mid-June 2016. These are being vigorously examined and the process of issue of demands for the four financial years for six operators in 22 licence service areas in consonance with licence agreement is currently ongoing,” the department said.

“Revenue assurance is the top priority of the DoT. The government is determined to recover every rupee of underpaid amount with interest and penalty from every defaulting company in the minimum possible time,” the department said.


[email protected]


The article appears in the August 1-15, 2016 issue of Governance Now

Comments

 

Other News

Mumbai has just 1.28 sq.m. of open space per person: Study

Mumbai`s public space crisis is as much about mismanagement as it is about scarcity, and offers a governance roadmap that can be implemented without new legislation, according to a new report by the Urban Design Research Institute (UDRI) and the NGO Alliance for Governance and Renewal (NAGAR).  

Lok Sabha passes amendment bill to improve public examination system

The Lok Sabha on Wednesday passed the Public Examinations (Prevention of Unfair Means) Amendment Bill, 2026 by a voice vote after an extensive discussion. Replying to the debate, minister of state (independent charge) for science & technology; earth sciences and MoS in the PMO, Dr. Jite

Shri Abhijit Phukon (IES, 2004) appointed as Joint Secretary, Department of Agriculture & Farmers Welfare.

 Shri Abhijit Phukon (IES: 2004) has been appointed as Joint Secretary, Department of Agriculture & Farmers Welfare, Government of India. His appointment, approved by the

Shri Avanish Kumar Mishra (ISS, 2000) appointed as Joint Secretary, Department of Administrative Reforms & Public Grievances.

 Shri Avanish Kumar Mishra (ISS: 2000) has been appointed as Joint Secretary, Department of Administrative Reforms & Public Grievances (DARPG), Government of India. The appointment, approved by the Appointments

Millets are thriving. Are millet farmers?

The story of millets is nothing short of extraordinary. Once seen as the food of the poor and downtrodden, they are now seen as the food of the health conscious and the elite. Today, these nutri-cereals occupy prominent shelves in premium supermarkets, feature on the menus of gourmet restaurants, and are e

More judges will not fix courts without better court work practices

A vacant courtroom cannot decide a case. Neither can a poorly managed courtroom simply decide twice as many cases after receiving an additional judge. Judicial capacity and court productivity are related, but they are not the same. The distinction matters because India’s district and subord

Upcoming Conferences



-->

Archives

Current Issue

Opinion

Facebook Twitter Google Plus Linkedin Subscribe Newsletter

Twitter