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Rediff.com  » Business » Did not favour RCom, says a rattled Sibal

Did not favour RCom, says a rattled Sibal

Last updated on: July 8, 2011 17:05 IST

Did not favour RCom, says a rattled Sibal

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Onkar Singh in New Delhi


Telecom Minister Kapil Sibal tried to put up a brave front over the allegations levelled against him of causing loss to the government by favouring an Anil Ambani-led company.

However, he rejected charges of favouring Reliance Communications, Telecom Minister Kapil Sibal on Friday insisted that the penalty of Rs 5 crore (Rs 50 million) imposed on it for interrupting services briefly was as per the agreement between USO Fund and the private operator.

It was more then evident that he was rattled and did not look comfortable while facing a volley of questions from the newsmen at a hurriedly arranged press conference.

Additional inputs: PTI

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Image: Telecom Minister Kapil Sibal.
Photographs: Reuters
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He dismissed as 'malicious, motivated and defamatory' the charges levelled against him by an NGO in a PIL filed in the Supreme Court that the company was imposed the penalty of Rs 5 crore against the Rs 650 crore (Rs 6.50 billion) as a favour.

Addressing a press conference, Sibal questioned the basis for computing the penalty as Rs 650 crore whereas the USO Fund itself had recommended a penalty of up to Rs 5 only.

"I am deeply grieved by what is happening by the PIL filed by an NGO in the Supreme Court stating that the telecom minister has abused his power to reduce penalty on Reliance Telecom to Rs 5 crore," an agitated minister said, adding that PILs should not be "used to settle personal score".

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Image: Reliance-ADAG chairman Anil AMbani.
Photographs: Reuters
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Did not favour RCom, says a rattled Sibal

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Giving details of the issue, he said Reliance Telecom services were switched off for "whatever reasons" in November 2010 and on December 21, a show cause notice was issued to the company threatening imposition of "lump sum" amount of Rs 50 crore (Rs 500 million) as penalty for the same.

"The notice for Rs 50 crore was to pressurise Reliance Telecom.... They got worried," Sibal said, adding finally the services were restored on February 16, this year and the company paid a penalty of Rs 5.5 crore (Rs 55 million).

He maintained that the penalty was calculated on the basis of duration of disruption of services (7-45 days) as provided in the agreement between USO Fund and RCom.

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Photographs: Reuters
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Sibal also termed as "unfortunate" the allegations that he had overruled officials of his ministry, saying the government could not function this way that a minister cannot take a decision because he would be labelled as "dishonest and wanting to favour private parties".

Sibal suggested that the PILs were being misused as they were meant only for serving public interest and "not to settle personal score". He, however, did not elaborate even when asked whether he felt he was deliberately being targeted.

An application was filed in the Supreme Court by Centre for Public Interest Litigation (CPIL) alleging that Sibal reduced the penalty from Rs 650 crore to Rs 5 crore against Anil Ambani-headed RCom for violations in the UASL agreement.

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Photographs: Reuters
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The NGO alleged that a penalty of Rs 50 crore per circle should have been imposed for "violation of the terms and conditions of Universal Service Obligation Fund agreement and UASL agreement by voluntary, unilateral and unauthorised switching-off/closure of services to subscribers from USOF sites without any notice."

"The Rs 5 crore penalty on the ADAG firm was as per the agreement between the USOF and Reliance Telecom. The DoT was nothing to do with the penalty as the company had not violated the rules of license conditions," Sibal said.

He said when the file reached him on February 18, this year, RCom had already restored the services two days prior to that.

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Photographs: Reuters
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He said he gave instructions to impose penalty as per the provisions of the agreement and did not himself decide the amount of Rs 5 crore as penalty.

He, however, was evasive when asked on what basis Rs 50 crore was decided as penalty.


Photographs: Reuters
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