But after January 18, they are liable to pay reserve price

The Supreme Court on Monday permitted the existing 2G spectrum licensees to operate their services beyond January 18 till the next hearing on February 4.

The Centre sought extension of the time limit for the licensees whose permits stood quashed by the February 2, 2012 judgment. A Bench of Justices G.S. Singhvi and K.S. Radhakrishnan, while allowing the extension, asked the Centre to spell out the price to be charged for continuing with their service after cancellation of the licences last year. “Just put it in a sealed envelope what is the amount to be paid by them after our order of February 2, 2012.”

The court had last February cancelled 122 licences but allowed these operators to continue for four months till the subsequent auction, which was held and the time limit for the operators was extended further.

The Bench asked the Centre to furnish details of the successful bidders in the first round held in November last and the reserve price proposed for the auction to be held in March. It also sought details of the number of operators whose licences were cancelled, those who participated in the fresh auction and how many of them continued with their operations.

Justice Singhvi told senior counsel P.P. Rao that the telecom operators who had enjoyed the benefit of the order to continue with their operations till the fresh auction would be liable to pay the reserve price after January 18. He said the decision to reduce the bidding price after the first round of auction for spectrum was bound to evoke further litigation.

Mr. Rao said the government was committed to ensuring that the March auction was conducted fairly and impartially with the participation of all eligible persons in keeping with the principles enunciated in the February 2, 2012 judgment.

In its application, the Centre said the government intended commencing the auction in the 1800, 900 and 800 MHz bands on March 11 and completing it soon thereafter. “The existing operators whose licences stand quashed… may not evince interest in such an auction if they are not allowed to offer their services pending the auction and this may impact the discovery of an optimal price for spectrum.”

In the event that the existing operators were permitted to offer their services till the commencement of operations by the successful bidders in the proposed auction, “this court may impose a condition that such operators will be liable to pay for the spectrum at the proposed auction or the reserve price, whichever is higher, with effect from December 19, 2012,” the Centre said.

In the auction that concluded on November 14 last, successful bids were received in 18 out of 22 service areas in the 1800 MHz band. No bids were received for the Delhi, Mumbai, Karnataka and Rajasthan service areas. Five companies participated in the auction and 102 blocks of 1.25 MHz each were auctioned for Rs. 9,407 crore. No bids were received in any of the 21 areas in the 800 MHz band.

The Centre said: “The Department of Telecommunications is in the process of issuing letters of intent to the successful bidders who require a fresh licence. They will be given seven days’ time to complete the conditions precedent to the issue of a fresh licence and it had been decided to have another round of auction in Delhi, Mumbai, Karnataka and Rajasthan.

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