Loop takes tribunal action against govt

Dylan Bushell-Embling
30 May 2012

India's Loop Telecom has commenced arbitration against the telecom ministry, seeking a refund of the fees the company paid for its 2G spectrum licenses due to be revoked next month.

The company has filed a complaint against the ministry and regulator TRAI with the Telecom Dispute Settlement and Appellate Tribunal (TDSAT), Times of India reported.

Loop is pursuing a return of the 14.54 billion rupees ($257.4 billion) it paid for 2G spectrum and accompanying licenses in all but one of India's 22 telecom circles.

The company is also seeking 10 billion rupees in damages in compensation for alleged loss of reputation arising from the license cancellation.

Finally, the operator is requesting interest payments on the license fees, as well as compensation for expenses incurred in deploying 2G infrastructure.

Loop and seven other mobile operators have since February been grappling with the fallout of a Supreme Court decision to revoke all 122 of the 2G licenses awarded in 2008 under a controversial “first-come-first-served” allocation process. The court ordered that the licenses be revoked in June.

Loop is arguing that the cancellation of the licenses is a direct result of decisions by the department and the regulator, and so they are to blame for the court decision's impact on the operator's finances and reputation.

A successful TDSAT appeal by Loop Telecom might leave the department and regulator more vulnerable to arbitration action from some of the other operators facing the imminent loss of their 2G licenses.

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