The Telecom Disputes Settlement and Appellate Tribunal (TDSAT) has rejected Loop Telecom?s appeal filed against the government’s direction pertaining to the renewal of its performance and financial bank guarantees for spectrum in 21 circles.
The TDSAT has also rejected the operator?s request to bar the Department of Telecommunications (DoT) from taking any coercive measures such as invocation or encashment of guarantees, in case of non renewal. According to TDSAT, since Loop Telecom?s licences and the bank guarantees are valid until January 9, 2013, barring DoT from taking action against the operator in case of non-renewal of the bank guarantees was baseless.
Prior to this, DoT had issued letters to Loop Telecom, asking the operator to renew its financial and performance bank guarantees in select circles. DoT had also mentioned that the operators? bank guarantees would be invoked in case of non-compliance.
Thereafter, Loop Telecom approached the TDSAT stating that it had already shut down operations, following the cancellation of its licences by a Supreme Court order in February 2012. Hence, it did not require to fulfill obligations such as renewing its bank guarantees.
However, TDSAT rejected the operator?s application, on grounds that as per current licence conditions, ?on termination or expiry of the licence, the bank guarantee shall be released to the licencee only after ensuring clearance of old dues which the licencee is liable to pay to the licensor (DoT).?
