The Department of Telecommunication (DoT) has instructed all telecom companies and Internet Service Providers (ISPs) not to accept any new bank guarantees from Axis Bank.
The DoT, in a letter dated March 16, a copy of which is available with The Hindu , informed telecom operators that Axis Bank was in “serious breach of trust and contract” with the Government of India (GOI).
The letter said Axis Bank had failed to honour the Bank Guarantee issued by them on behalf of Aircel Group of Companies.
Directing the telcos and ISPs not to accept any new bank guarantee from Axis Bank, the DoT letter said, “In view of this, you are hereby directed not to accept any new bank guarantee from Axis Bank, including renewals.''
The amount of bank guarantee given by Axis Bank on behalf of Aircel could not be independently verified. A mail sent to Axis Bank seeking a response remained unanswered till the time of going to the press.
Aircel has filed for bankruptcy at the Mumbai bench of NCLT citing high unsustainable debt, price wars, legal and regulatory challenges. The company has Rs 15,000 crore of dues to the lenders and Rs 35,000 crore to operational creditors.
Aircel has spectrum in the 900MHz, 1800MHz and 2100MHz bands, respectively. According to current rules, Aircel is not entitled to get back a part of its money after surrendering its spectrum to DoT.
