CVC questions 2G spectrum allocation

Unhappy with the reply of the Department of Telecom, the Central Vigilance Commission has shot off another letter seeking clarity on the policy for allocation of spectrum for existing 2G mobile services.

"(The) reply furnished by DoT is not specific about the methodology adopted for assessment of optimum use of allotted spectrum and the precise manner of application of methodology," the CVC said in its letter to the DoT last week.

The CVC wanted to know that whether auction process for2G spectrum is the right choice and desirable at this juncture.

Communication and IT Minister A Raja has been in the line of fire ever since he distributed 120 new telecom licences last year along with start-up spectrum of 4.4 MHz at a cost of just Rs 1,651 crore each compared to its market value running several times of this amount.

While allocating spectrum, Raja had said that since the existing GSM operators have been given frequency at the same terms and conditions, including price, till as late as in 2007 auction cannot be introduced for new players as this may result in numerous litigations.

"DoT's reply is totally revolving around assumptions and conjectures. Appropriate decision of the competent authority is a vague pharse and is non-transparent. This may be clarified", CVC said.

The anti-corruption body is also not satisfied with DoT on its first-cum-first-serve criteria and the two different dates --September 25 and October 1-- as the cut-off dates for receiving USAL applications.

In November, the CVC had sought details of the government policy of allotting spectrum to new telecom firms at Rs 1,651 crore for all-India licence.

The Commission's action had come in the wake of two new firms -- Swan and Unitech -- selling stake in their telecom ventures to foreign players at a huge premium which alleged to have caused massive revenue loss to the exchequer.

The CVC had also pulled up telecom regulator TRAI for not fulfilling its role in advising the Department of Telecom on spectrum allocation process.

Seeking details from the DoT on its spectrum allocation policy, the CVC had said, "The department may follow an auction process for allocation of balance 2G spectrum even though the available spectrum is of meagre quantity."