Friday, 29 June 2012

DoT may penalise 5 telcos for under-reporting revenues

Department of Telecom is learnt to be in process of sending demand notice to five private operators for under reporting their revenues in two years.
The department has earlier issued show cause notice to Bharti Airtel , Vodafone, Reliance Communications , Tata Teleservices and Idea Cellular after a special audit revealed under reporting of revenue during assessment years starting from 2006 to 2008.

The department is expected to raise a demand of about Rs 823 crore all the telecom companies, sources said.
Sources in DoT said RCom may be asked pay around Rs 310 crore, Bharti Airtel Rs 161 crore, Tata Teleservices Rs 179 crore, Vodafone Rs 107 crore and Idea Cellular about Rs 64 crore.
All the five companies declined to comment on the matter.
Telecom regulator Trai in 2009 had asked the DoT to conduct a special audit of financial accounts of these five telecom companies for the 2006-08 period observing that operators were under-reporting their revenues to avoid payment of licence fee to the government through revenue share.
The move was to check operators' scope to arbitrage, which is shifting revenue from higher licence fee to the lower side. The UASL (basic and mobile) telephony has a licence fee of 6-10% where as NLD, ILD, ISP and Internet Protocol has 6%.
Trai had noticed that some of operators were showing more revenue in segment that carried lower licence fee.
The special audit was for those companies which have multiple licences - Unified Access Service Licence (UASL), National Long Distance (NLD), International Long Distance (ILD) and Internet Service Provider (ISP). All the five companies mentioned above have all these licences.

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