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August 10, 1999


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Officially unofficial! Court flags off telecom policy finally but key issues will need new Parliament's approval. Onkar Singh in New Delhi

The Delhi high court today allowed the central government to implement the New Telecom Policy, 1999.

Email this story to a friend. But the court has insisted that the revenue sharing package in the policy will remain subject to clearance by the new dispensation at the centre and its subsequent approval by Parliament.

A division bench comprising Chief Justice S N Variava and Justice S K Mahajan clarified that it is only passing an interim order, which is neither an approval nor disapproval or a vindication of the policy.

A coalition government led by the Bharatiya Janata Party introduced the New Telecom Policy. The government lost mandate recently and a mid-term general election has been scheduled.

The court also made it clear that should the Election Commission decide to investigate the matter of its own, it would be free to do so and take whatever decision it deems fit to be taken.

In its last hearing of the matter on August 3, the court had given the government and the telecom operators to accept its suggestion that they would abide by the decision taken by the New Lok Sabha after the elections.

But neither of the telecom operators nor the government filed any undertaking to this effect before the court took up the matter this morning.

The bench has now directed basic and cellular telephony licensees to place individual undertakings before the court as a precondition to the implementation of the migration package.

The migration package allows telephone companies to shift from a license fee regime to a revenue sharing regime.

''Each and every basic and cellular licensee will have to give an undertaking that the implementation of the migration package would be subject to the approval of the council of ministers after the constitution of the new Lok Sabha (lower house),'' the order noted.

Earlier, Attorney-General Soli Sorabjee had assured the court that the government would abide by the decision taken by the court. But he refused to accept the plea that court could direct the present government to give an undertaking that the New Telecom Policy would be placed before the new Lok Sabha.

The judges said the undertakings would be in operation till December 31, prior to which the court is scheduled to have another hearing on December 6.

The judges ruled that each and every licensee would undertake before the court that in case the new council of ministers or the Lok Sabha disapproved the revenue sharing package, they would not claim any right or equity out of the said package and would go back to the 1994 licence policy.

The ruling would only be applicable to licensees who give undertakings to the court and not to those whose licences have been terminated, the court said.

If disapproved, the licensees, under the migration package, would be termed as new operators under the old policy, it said.

Under the New Telecom Policy the metro players would be sharing with the government 15 per cent of their revenue.

This arrangement, according to the Communist Party of India, Marxist, and the Congress party office bearers would be much lower to the agreed amount between the telecom operators and the government in the previous telecom package.

CPM General Secretary Harkishan Singh Surjeet told Rediff in an informal chat that they have not yet received the court orders. They would like to read the entire order before commenting upon it. "As I understand, the court has directed the telecom operators to give an undertaking that they would abide by the decision taken by the new house after the elections. Till this point, we feel satisfied. But since the court has allowed the telecom operators to take advantage of the new policy after giving an undertaking, we feel that the decision would have a great impact on the electorate. We will now take up the matter with the Election Commission once more and press for a stay on the implementation of the New Telecom Policy till the entire election process is over so that the BJP does not gain any advantage," Surjeet said.

When contacted, Election Commission sources refused to confirm or deny whether they would take up the matter once again. Earlier, the commission had left it to the two-judge bench of the Delhi high court to take a decision on the matter at the earliest in the hope that the commission would not have to deal with it on its own.

"Now that the court has left it on the commission to investigate the matter, the commission would take notice of the new situation and decide the issue accordingly when its meets tomorrow," said a senior functionary of the Election Commission of India.

The court has now posted the matter to December 6 for next hearing. It has, in the meanwhile, asked the licensees to file their undertakings before they could avail of the new agreement.

The CPM and the Congress have alleged that under the New Telecom Policy the government would lose Rs 500 billion. The government has denied this. It has also denied involvement of the Prime Minister's Office in any kind of telecom scam that the opposition is trying to make out.

Commenting upon the developments in the court, Arun Jaitely of the BJP said that the new telecom policy would have to go through. "The obstructionist policies of the opposition would only bring the development in the telecom sector to standstill. The new policy has corrected the faults of the Rao government. It would not help anyone if we were to go back to the old policy," Jaitely said.

Attorney-General Soli Sorabjee has also made it clear that the operators cannot claim any right or equity on the new policy if the next government or Lok Sabha disapproves the package. The telecom operators have agreed to the suggestion in principle.

A public interest litigation filed by the Delhi Science Forum had challenged the validity of NTP-99, which provides for switching over to a revenue sharing system from a fixed licence fee regime for existing operators.

The PIL had alleged that the offer made to the existing operator-licensees to migrate to the revenue sharing system had resulted in a loss of tens of millions of rupees to the public exchequer.

The switch over to the revenue sharing system from the fixed licence fee regime was scheduled to take effect from August 1 and the telecom operators had been asked to give their acceptances by July 29. Most of the companies gave their acceptances for the revenue sharing system.

The telecom operators had also been asked by the government to withdraw all cases pending in courts and before the Telecom Regulatory Authority of India as a precondition for migrating to the revenue sharing scheme.

The judges are of the view that the next government, if it approves NTP-99, should also place it before Parliament by December 31.

Sorabjee, however, is of the view that there is no need for placing the new telecom policy before the Lok Sabha if it is approved by the council of ministers as the latter enjoy the majority of the house.

To the contention of the licensees that the government give an assurance that the next dispensation would allow continuation of NTP-99, Sorabjee stated that the successor government is not bound by any decision of the present government and hence this condition cannot be met.



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