No leniency to RCom if it defaults on dues, says DoT

No leniency to RCom if it defaults on dues, says DoT
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New Delhi, Dec 20: Telecom licence of debt-laden Reliance Communications (RCom) can be cancelled and its spectrum can be withdrawn if the company fails to make statutory and spectrum payments slated for early next year, top government officials have said.
The buzz resulted in the RCom stock crashing nearly 10% by close of Wednesday’s trade on the BSE.
The tough stance comes at a time when the proposed spectrum-trading deal between RCom and Reliance Jio is stuck in a logjam.
Jio is demanding a commitment from the department of telecom (DoT) that it should not be held liable/accountable for any dues that may be raised against RCom in relation to any ‘past liabilities’, which may arise after its deal. Jio’s demand, made through an official letter, comes even as RCom has submitted a guarantee by way of a land parcel to meet any such liability.
Jio has demanded an assurance from DoT, but the latter refused to give any such undertaking. “While we have given the deal a no-objection certificate, we cannot give any undertaking to Jio that grants them special protection in case RCom’s land guarantee is not found to be sufficient. Either of the parties will have to pay, in case the situation so arises,” an official said. It is estimated that RCom’s liabilities towards DoT could be up to Rs 2,900 crore.
Questions sent to RCom and Jio on the matter remained unanswered.
With troubles for RCom mounting, the government made it clear that no leniency can be accorded to the company in case it defaults on its statutory payments. The company will be required to pay its licence fee in early January for the October-December 2018 quarter.