DoT has passed on huge benefits to Sunil Bharti Mittal on account of Tikona. Bharti’s acquisition of Tikona, a BWA (4G) operator, has many layers of irregularities and its loss impact for the government is to the tune of Rs 320 crore.

Auctions for 3G and BWA were conducted in May 2010. Conditions and auction process was different but in the NIA, there was a common objective. This was prevention of spectrum hoarding. Hence rollout conditions were important. The time allotted for BWA rollout was five years. There was no provision for extension on payment of penalty as in the case of 3G; outright spectrum withdrawal was provisioned incase of non-completion of rollout in BWA.

Tikona Digital Networks Pvt Ltd won the BWA spectrum in five circles for Rs 1,058.20 crore. Tikona was allocated spectrum on 19.11.2010 for all the five circles. It had time to complete the rollout by 18.11.2015. Barring Rajasthan, Tikona completed the rollout in four circles. It completed the rollout on 11.02.2016 for Rajasthan. As per the NIA condition the spectrum was to be taken back for the Rajasthan circle, but nothing happened. Tikona had paid Rs 97.32 cr for Rajasthan circle spectrum. The TERM Cell of DoT did not act. In all, Tikona could acquire only 4 lakh subscribers in all these years. A textbook method of hoarding!

Then Bharti acquired Tikona. Issues emerged during the approval process. The first pertained to the Rajasthan rollout. DoT just levied penalty for rollout delay instead of withdrawing spectrum. It was a post tender benefit passed on to a private party. This was done by using and mixing unrelated two conditions mentioned in the NIA. The DoT could use discretionary power for less serious breaches. Discretionary power was invoked, which means non-fulfillment of rollout obligation is a less serious breach, according to DoT. To this was added another condition applicable to 3G rollouts for penalty due to delay (@2.5 per cent of spectrum acquisition price). A penalty of Rs 2.43 crore was worked out, that Bharti paid and a change of ownership was taken on record.

The second benefit was passed on in the form of voice over BWA without payment of entry fees. In pending matters (Qualcomm & Augere) about similar charges, Bharti Airtel got a stay of DoT dues from TDSAT. DoT has not challenged this, which has come in good use in the case of Tikona too. For complete details read our cover story.