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Cellular Operators' Association of India not to seek legal recourse for stay on spectrum auction

The lobbying body of GSM players, Cellular Operators' Association of India (COAI), has decided to steer clear of filing any legal petition in the court seeking a stay on spectrum auction due next month in what was being perceived by it as `anomalies' in the notice inviting application (NIA).

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The lobbying body of GSM players, Cellular Operators' Association of India (COAI), has decided to steer clear of filing any legal petition in the court seeking a stay on spectrum auction due next month in what was being perceived by it as `anomalies' in the notice inviting application (NIA).

This has prevented an imminent legal face-off between the government and telecom companies (telcos). The government, which has followed a long-drawn procedure for arriving at the quantum and price of airwaves to be auctioned, has declined to pander to a few demands of telcos.

COAI was in consultation with its lawyers on the issue. Rajan Mathews, director general of COAI, did not elaborate on the reason for not taking the legal course but said "individual operator will follow its own strategy".
"We have decided not to go to the court for a stay on the auction (to address our complaints). It has been decided that each operator will follow its own strategy," he said.

The telecom ministry has decided to hold spectrum auction on March 4. COAI's move would have disrupted the government's auction plans, where it expects to generate Rs 80,000 crore to Rs one lakh crore revenue by selling airwaves in various bands of 800 MHz, 900 MHz, 1800 MHz and 2100 MHz. Of the total revenue, around Rs 25,000 crore is expected to come in the current year. The telcos can make the payment for the spectrum acquired in the auction over 10 years.

The revenue raised through the spectrum auction will aid the government in meeting its fiscal deficit target of 4.1% of the GDP.

Mahesh Uppal of telecom regulatory consultancy firm ComFirst India Pvt Ltd said the operators desperately need spectrum but not at such high prices.

"If the auction is delayed there are consequences. At the same time, they also do not want it to be expensive. They are trying to strike a balance between their objectives of early availability and affordability of spectrum," he said.

Mathews said there was already a case in the Supreme Court (SC) filed by Vodafone India for the extension of its 20-year-old licences in six circles by another 10 years. Vodafone's licence is due to expire in December this year.

The petition of British telecom's Indian arm in the apex has sought an interim direction for restraining DoT from auctioning airwaves in Maharashtra, Gujarat, Haryana, Uttar Pradesh (east) and Rajasthan. The decision on the case is still pending.

If the final order goes in favour of India's third largest telecom player then it could jeopardise the government's auction as planned by the department of telecom (DoT) now.

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