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Sunday, July 10, 2011

Sibal defends lowering of penalty for RCom

A day after a public interest litigation (PIL) petition was filed in the Supreme Court against Communications and IT Minister Kapil Sibal accusing him of monetarily favouring the Anil Ambani-headed Reliance Communications Ltd. (RCom), the Minister denied the charges and asserted that the Rs. 5-crore fine imposed on the firm was as per the terms and conditions of the agreement signed between the government and the private operator.

“In November 2010, the Department of Telecommunications [DoT] served a show-cause notice to RCom for shutting down telephone towers in 13 telecom circles that it had put up with money allocated from the Universal Service Obligation Fund [USOF] and imposed a fine of Rs. 50 crore. But by the time the file reached me in February 2011, RCom had restored the services. Hence, action could not be initiated for termination of services [as intended originally] as per the licence agreement signed [only] between DoT and RCom, but for disruption of services as per the agreement signed between USOF and RCom and the penalty was recalculated from Rs. 50 crore to Rs. 5 crore,” Mr. Sibal told journalists here on Friday.

The DoT never sought Rs. 650-crore penalty as mentioned in the PIL. “I am deeply grieved by what is happening by the PIL filed by the NGO alleging that the Telecom Minister has abused his power to benefit RCom by reducing penalty to Rs. 5 crore. The proceedings initiated by way of an affidavit in the Supreme Court in the 2G case are malicious, motivated and defamatory. PILs are being misused to tarnish the image of Ministers … PILs should not be used to settle personal scores. It is a dishonest PIL…governments cannot function in this manner,” Mr. Sibal said.

The Minister, however, did not give reasons for RCom switching off the telecom towers in rural areas and why the DoT took over four months to take action against it. “The notice for Rs. 50 crore was to pressure RCom...they got worried and finally restored the services. They paid a penalty of Rs. 5.5 crore,” he added. Mr. Sibal also rejected the charge that he had favoured RCom because it had been his client earlier. However, defending the PIL plea filed by the Centre for Public Interest Litigation (CPIL), lawyer Prashant Bhushan said the action against RCom should have been initiated for violation of licence conditions that called for a penalty up to Rs. 50 crore per telecom circle.

“As separate licences are issued for each circle, penalty for violation of licence agreements in 13 circles will be to the tune of Rs. 650 crore and not Rs. 50 crore or Rs. 5 crore what the DoT later charged,” he pointed out.

On Mr. Sibal's objection linking the PIL plea to the 2G scam, Mr. Bhushan said the violations by RCom were linked to 2G licence conditions. “As per the Supreme Court's directions, the CBI is probing the entire gamut of 2G licences — irregularities in its allocation and non-fulfilment of licence conditions, therefore this should also be a part of the 2G scam case,” Mr. Bhushan said.

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