BSNL holds broadband wireless access cash, govt gets Rs 8k cr less

State-owned Bharat Sanchar Nigam Ltd (BSNL) continues to be in negotiation with the government for more time to pay the wireless broadband spectrum charges, even as the deadline expired on Tuesday.

BSNL is supposed to match the winning pan-India bids (except Delhi and Mumbai reserved for MTNL) of the broadband auction that concluded recently.

The telecom giant is in dialogue with the government for extension of the deadline, an official told this newspaper. The official added that BSNL has not refused to make the payment, but is only asking for more time.  

BSNL is required to pay Rs 8,313 crore as spectrum charges for offering broadband wireless access (BWA) service.

State telcos were given spectrum for both 3G (third generation) and BWA more than a year ago without participating in the process of auction, and were asked to match the winning bids later.

While BSNL had paid the 3G spectrum money to the government within the stipulated time period, subsequently it sought a refund from the Department of Telecommunications (DoT).

BSNL argued that even as private players made an informed decision on bidding for spectrum during the recent auction, state telcos have had to match the highest bids without participating in the process of auction.

Also, BSNL’s point is that it has been allotted spectrum across service areas for 3G and BWA without being given any choice.   

Even as the DoT rules state that the earnest money deposit would be forfeited if a participant fails to pay up by the due date, this cannot apply to BSNL. As the state-owned telco did not participate in the auction process, it didn’t have to pay any earnest money either. Other bidders opting for pan-India broadband spectrum had paid Rs 252.5 crore each as earnest deposit.  

DoT’s  auction document states that the Government has allocated one block of 20 MHz of unpaired spectrum in Delhi and Mumbai for MTNL and one block of 20 MHz of unpaired spectrum in the remaining service areas for BSNL for BWA. “BSNL and MTNL shall not be participating in the BWA auction, but shall be required to match the winning price achieved in the respective service areas in the BWA auction as payment for the spectrum allotted to them,” it said.

According to the auction norms, “the spectrum assignment may be revoked, withdrawn, varied or surrendered in accordance with applicable licence conditions or any other applicable laws, rules, regulations or other statutory provisions.”

However, the government is not likely to take any harsh steps against BSNL in this case. Apart from BSNL, all the successful BWA bidders made the payment to the government on Tuesday.