Tata Communications has held the Department of Telecommunications responsible for the delay in demerging land held by Videsh Sanchar Nigam Limited, say news reports.
In a letter to Kapil Sibal, Minister of Telecommunications and IT, the company said that it had submitted a proposal for the demerger to DoT in 2005 and is still awaiting a response on the same.
In the letter, Subodh Bhargava, chairman, Tata Communications said, ?You would agree that the demerger of this surplus land is waiting for the government’s response on the matter. You should also recognise that the board of Tata Communications has two directors nominated by the government and they are apprised of all these issues.?
Explaining the sequence of events, Bhargava said the Tata group had sent a draft scheme of the demerger of Tata Communications, which was placed before the board of Tata Communications on April 11, 2005. These documents had been sent earlier to DoT on March 28, 2005. At the board meeting, the government directors requested 15 days time to examine the scheme. However, DoT did not reply on grounds that it was seeking legal opinion on the proposed demerger scheme. A reminder was sent by Tata Communications on July 26, 2006. DoT replied a month later repeating its earlier position that it was still considering the scheme.
The letter from the Tata company comes after Sibal said that he had ordered a probe into the entire stake sale in VSNL by the government. The minister had said that the delay in demerging surplus land owned by VSNL was in violation of the shareholders agreement signed between the Government and the Tata group.
The issue relates to the 773 acres owned by VSNL, which was not part of the sale agreement the NDA government had signed with the Tata group in 2002. The land, spread across five cities, was supposed to have been demerged after the sale, which has not happened.
The delay has been on account of a disagreement between the government and the Tata group on who will fund the demerger. The Tata group wanted the government to take on the burden as they did not have any stake in the land.
