DoT to issue demand notes to telcos

The demand note follows auctions raking-in winning bids of over Rs 77,800 crore, for 855.6 MHz of spectrum

New Delhi: The Department of Telecommunications (DoT) will issue demand notes to telcos next week on an upfront payment for spectrum acquired in the just-concluded auctions, sources said.

The demand note follows auctions raking-in winning bids of over Rs 77,800 crore, for 855.6 MHz of spectrum. Billionaire Mukesh Ambani’s Reliance Jio spent the most in the auction, picking up 488.35 MHz spectrum in bands such as 800 MHz, 1800 MHz and 2300 MHz for Rs 57,122.65 crore.

Bharti Airtel bid about Rs 18,699 crore to acquire 355.45 megahertz (MHz) out of the total 855.60 MHz of radiofrequency acquired by all telcos, while Vodafone Idea, bought 11.80 MHz of spectrum worth Rs 1,993.40 crore.

DoT sources told PTI that the demand notes will be sent out to the three companies this week, and entails largely the upfront payment for spectrum that is ready to be allocated. Spectrum will be offered for assignment for a validity period of 20 years. As per the auction terms, successful bidders can pay entire bid amount in one go, or exercise an option to pay a certain amount (25 per cent for spectrum won in 700 MHz, 800 MHz, 900 MHz bands or 50 per cent for spectrum won in 1800 MHz, 2100 MHz, 2300 MHz, 2500 MHz bands) upfront with remaining amount in a maximum up to 16 equated annual instalments, after a moratorium of two years.

A DoT official said the demand notes together total about Rs 20,000 crore, but did not provide operator-wise break-up. About 2308.80 MHz of spectrum, that carry telecom signals in seven bands worth nearly Rs 4 lakh crore at start price, was up for bidding in the auction held recently. Although the spectrum finally acquired by telcos fell woefully short of this overall kitty and bids hovered at reserve price, DoT said, and analysts concurred, that auction outcome and response had surpassed initial expectations.

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