Tata Teleservices (Maharashtra) slips for defaulting DOT licence fee

Tata Teleservices (Maharashtra) declined 0.69% to Rs 35.80 at 12:52 IST on reports the Department of Telecommunications has filed a petition before the telecom tribunal seeking to recover Rs 2015 crore from the company for defaulting licence fee.

The stock hit a high of Rs 36.40 and a low of Rs 35.50 so far during the day. The stock had a 52-week high of Rs 65 on 4 January 2008 and the stock hit a 52-week low of Rs 24.50 on 9 July 2007.

The company’s current equity is Rs 1,897.19 crore. Face value per share is Rs 10.

As per reports, the controversy started when the department of telecommunication (DoT) alleged the erstwhile Hughes Tele.com, now Tata Teleservices Maharashtra (TTML) over the non-implementation of Karnataka circle basic service letter of intent (LoI) of 1997 and DoT recovered Rs 50 crore from Hughes Tele.com in 1999 for not signing the basic service licence for Karnataka circle. This was challenged by Hughes Tele.com before the Telecom Disputes Settlement & Appellate Tribunal (TDSAT) in 2001.

Later, TDSAT in its judgment of 2003 on this matter held as illegal the recovery and ordered DoT to refund Rs 50 corre to TTML (the erstwhile Hughes Tele.com) with interest at 17% and also awarded Rs 10,000 as costs to TTML.

DoT at the end of the TDSAT hearing in 2003 made a counter-claim of Rs 654 crore against TTML, alleging loss of licence fee of Rs 303 crore and the balance calculated as interest up to October 2002.

TDSAT in its judgment recorded that this counter-claim was an after thought on the part of DoT; DoT had never issued any notices to TTML for such an amount, and if DoT had any right to recover such amount, as per law it would necessarily have to take appropriate proceedings before other Courts. The DoT`s counter-claim was accordingly rejected by TDSAT keeping in view the law and the facts of the case.

TTML believes the current counter-claim has no merit whatsoever, and if admitted by TDSAT will contest it once again, and as on the previous occasion, is confident it will succeed once more.

Tata Teleservices (Maharashtra) reported net loss of Rs 27.43 crore in Q3 December 2007 as against net loss of Rs 59.17 crore in Q3 December 2006. Sales rose 21.3% to Rs 439.76 crore in Q3 December 2007 over Q3 December 2006.

The Tata group operates mobile services through two companies – the listed Tata Teleservices (Maharashtra) and unlisted Tata Teleservices. Tata Teleservices (Maharashtra) offers CDMA-based services in the Maharashtra and Mumbai circles, while Tata Teleservices operates in 18 circles.