The roll-out of 3G or third-generation mobile telephony services, scheduled for this year-end, may be delayed after the Ministry of Finance strongly criticised the Department of Telecommunications for announcing 3G guidelines without consulting it.

In a communication with the DoT earlier this week, the finance ministry said the move was inappropriate and contrary to a 2003 cabinet decision.

It has asked the DoT to set up consultative meetings with the appropriate authorities in North Block so that the requisite approvals are obtained before the policy is finalised.

Communications Minister A Raja had announced the guidelines for 3G services -- which offer high-speed downloads of data and voice such as movie and video clips -- on August 1, saying it would auction five to ten 3G licences per service area.

Raja also issued 3G licences to state-owned BSNL and MTNL [Get Quote] without waiting for the auction and said they would roll out their services within six months.

The DoT also fixed the base price for the auction, which varied from Rs 30 crore to Rs 160 crore depending on the service area. Raja also announced that he hoped to rustle up Rs 40,000 crore from the auction.

The finance ministry has, however, acknowledged that the revenues from the auction would go a long way in helping to reduce the country's fiscal deficit.

In its communication with the DoT, the finance ministry has stated that under the Transaction of Business rules, 1961, it is mandatory for other government departments to consult it on all issues that have financial implications.

The DoT guidelines, it said, fall in this category as they contain clauses that have financial implications for the government. These issues include the method of determining the spectrum acquisition price, fixing a reserve price for auctioning, spectrum usage charges and penalties for operators that hoard spectrum.

The finance ministry has also stated that a Cabinet meeting on October 31, 2003, had clearly decided that spectrum pricing would need to be decided mutually between the DoT and the ministry of finance so as to provide an incentive for the efficient use of spectrum as well as a disincentive for sub-optimal usage.