WiMAX licences were misused, confirms DoT report

Shell companies got WiMAX licences from BSNL with the object of generating a high market valuation and cashing out, a preliminary report submitted by the DoT to telecom minister Kapil Sibal has concluded. Manoj Gairola reports.

Shell companies got WiMAX licences from Bharat Sanchar Nigam Ltd (BSNL) with the object of generating a high market valuation and cashing out, a preliminary report submitted by the department of telecommunications (DoT) to telecom minister Kapil Sibal has concluded.

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Sibal's predecessor, A Raja, who is currently in jail, had controversially decided to allot spectrum to four franchisees without charging any upfront entry fee and on a revenue sharing basis - even though BSNL had paid about Rs 8,320 crore as upfront entry fee for it to the government.

BSNL chairman and managing director Gopal Das could not be contacted for comments.

HT had been the first media house to break the news of this scam on February 7.

The franchisees were Teracom, Take Solutions, Adhishwar and Starnet.

On the basis of the report, the ministry has formed a committee under the member (finance) of the Telecom Commission to find out whether BSNL's commercial interests were sacrificed while appointing the franchisees. The committee will submit its report by March 15.

Sibal had, on February 7, asked DoT to scrutinise the entire process of appointing WiMAX franchisees by BSNL and suggest appropriate action.

The preliminary report has also hinted that the terms and conditions of the contract were changed after the letter of intent for the franchisee agreement was signed between these companies and BSNL.

It has also said that BSNL did not insist on experience or expertise in the telecom sector as pre-conditions for appointing franchisees. Only Teracom has experience in the sector.

"It may be noted that this is only a preliminary report. The committee will take a final decision," said a DoT official.