72 of 122 new 2G licenses are issued to disqualified telcos: CAG (India)
As per the Comptroller and Auditor General (CAG) , 72 out of 122 new 2G spectrum licenses issued by Telecom Minister A Raja in January, 2008, were awarded to companies that did not meet the eligibility criteria.
According to the government auditor, Datacom Solution, STel, the Unitech Group of companies and Allianz Infratech, among others, were issued licenses in 2008 even though they did not meet the eligibility criteria prescribed by the DoT at the time of application.
If sources are to be believed, the Telecom Ministry may issue show cause notices to new operators, including STel, Unitech Wireless and Datacom.
The DoT has asked for access to the documents available with the auditor for further investigation into the case and to issue a show cause notice for further action, including termination of the licenses awarded to the ineligible telcos.
If the DoT chooses to terminate the licenses, it would result in encashment of guarantees worth US$59.15 million, including financial bank guarantees worth US$42.25 million and performance bank guarantees worth US$16.90 million.
As per an internal CAG note, as indicated by DoT’s own stipulation, none of these companies were eligible to apply for the grant of unified access service (UAS) licenses on the date that they submitted their applications in DoT. DoT chose not to abide by its own guidelines and issued 122 licenses without detailed verification of the documents submitted by the applicants.
According to the audit body, the applications should have been rejected in the first place.
According to sources, the DoT is yet to respond to the CAG’s latest report, which also observed that the Telecom Ministry did not consider the Law and Finance Ministry’s views on allotment of 2G spectrum.
Indian operators question CAG’s power to audit them
www.WirelessFederation.com/news: Indian government move to direct the Comptroller and Auditor General of India (CAG) to audit telecom operators’ books has been questioned by country’s leading mobile operators, including Bharti Airtel, Vodafone Essar, BSNL and Tatas.
The five major operators, Bharti Airtel, Reliance Communications, Tata Teleservices, Vodafone Essar and state-owned BSNL of India has been asked by the communications ministry to provide all documents relating to their accounting details for three years beginning 2006-07 to CAG.
They have been given a time period of 15 days and have been asked to provide all the details including cost break-up and details of depreciation charged on fixed assets and other income.
Telecom operators like Bharti Airtel and Vodafone Essar have pointed out that powers of CAG do not extend to private operators. Earlier, Tata Communications too questioned the logic behind the government’s move to ask CAG to undertake another audit.
Indian telcos receive letter from DOT for audit
www.WirelessFederation.com/news: Letters have been issued to all the telecom companies by the Department of Telecom (DoT) for an audit by the Comptroller and Auditor General of India (CAG). Bharti Airtel, Reliance Communications and Vodafone, among others have been issued the notice for the CAG audit for the three financial years beginning 2006-07.
According to Vinod Rai, Comptroller and Auditor General, CAG is not in the process of immediately looking at the books but it is in the business of looking on telecom providers and operators etc. CAG is also auditing PPPs now and if there is a company which is participating with the public body and is using the government assets, CAG will be auditing them also
The move is considered to be significant as it comes after the special independent audit of telecom companies. It has been reported that Vodafone might submit the reports in a day or two.
