NEW DELHI: The Delhi High Court on Monday stalled the fine of Rs 350 crore on Bharti AirtelBSE -0.23 % for offering third-generation (3G) services in circles where it did not have licences, till next date of hearing on May 8.
The court allowed the country's largest mobile phone company by subscribers and revenue to continue offering 3G services in Haryana, Kolkata, Uttar Pradesh East, Maharashtra, Gujarat, Kerala and Madhya Pradesh, till the matter is heard again.
Bharti moved the Delhi High Court on Friday against the DoT directive that ordered the telco to stop providing 3G services in seven regions within three days. It also slapped a fine of Rs 50 crore for every region where 3G services were being offered in a pact with other operators. However, the court asked Bharti Airtel to keep revenue generated from these services in a separate bank account and submit 3G revenue details to the court. The high court also told the carrier to sign an affidavit saying that the government can be allowed to cash the bank guarantee if Airtel loses the case.
Bharti Airtel, Vodafone and Idea CellularBSE 0.93 %won 3G airwaves in 13, nine and 11 circles, respectively, in the 2010 auctions. They entered into intra-circle roaming pacts with each other that allowed them to use the others' airwaves in circles where they did not hold spectrum themselves, ensuring a national footprint for all three.
This has resulted in, for instance, a Bharti customer in Kolkata being able to access 3G services even though the company does not have a licence for West Bengal. The telecom department and sector regulator Trai said these pacts were 'illegal', a position that received the backing of the law ministry.
Telcos said they had entered into these roaming deals with the 'full knowledge and blessings of the DoT'. In the early hours of trade, Bharti Airtel's scrip fell to 301.2, the lowest in the day, but recovered to 310.5 after the court's order. The scrip closed at 308 on Monday on BSE.
ET had reported last week that Vodafone and Idea Cellular would be issued similar notices. This was the third notice to Bharti Airtel over the last two years asking it to stop 3G services such as video-conferencing, high-speed internet and interactive gaming outside its licensed zones.
The last instance was in October 2012, when Bharti had moved the Delhi High Court, and the latter had asked telco to reply to the department's notice and also directed the government to form a committee to look into the issue.
However, Bharti may face more trouble as the DoT plans to slap yet another notice for sharing 3G airwaves with Idea and Vodafone. ET reported on Monday that the telco may be asked to pay another 500 crore for this violation.