2G Scam Verdict: Supreme Court Cancels 122 Licenses

[kiran karthik]

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Bangalore: In a much awaited verdict, the Supreme Court of India has canceled 122 spectrum licenses granted to 11 companies after January 2008 and said the 2G spectrum allocation was done in an arbitrary and unconstitutional manner. In another critical judgment, the apex court has referred it to the trial court to decide if the role of the then Finance Minister P Chidambaram should be probed, a ruling said to be a breather for Chidambaram for now. However, the court did not find it necessary to have SIT to monitor the 2G scam probe.


The court also said that 85 of the 122 licenses are outside the eligibility criteria and directed Telecom Regulatory Authority of India to initiate a fresh issue of licenses in 4 months.


The cancellation of licenses include many corporate biggies including, Tata Telecom, Idea, Sistema, Videocon, Uninor, Loop, S-Tel and Swan Allianz etc. While a fine of 5 Crore has been levied on Unitech Wireless, Swan Telecom and Tata Telecom, 50 penalty was imposed on Loop, S-Tel, Allianz and Sistema Shyam.


As auction becomes the thumb rule in allocating spectrums, more serious players are expected to come to the game and spectrums will definitely become expensive. While it is good news for the old players such as Bharati Airtel who would get back their pricing powers, telecom operators are likely to increase the tariff.