1-6 /2001 -- LF

Department of Telecommunications

1300 (B), Sanchar Bhawan, 20 Ashoka Rd., New Delhi -- 110001

(Licensing Finance Cell)

 

 

Office Memorandum

Dated 28-5-2004

 

To

            The Controller of Communication Accounts/Joint Controller of Communication Accounts

            Maharashtra

 

 

Sub:     Transfer of work relating to licensing finance functions in respect of NEW UASL to the Office of Controller of Communication Accounts (O/o CCA) and a review of earlier instructions -- Reg

 

Ref:      (1) 1-6/2001-LFdated 8-10-2002

            (2) 1-6/2001-LFdated 8-12-2003

            (3) 1-6/2004/FBG dated 16-2-04

 

1.                   Attention is invited to the Office Memorandum referred to at (1) and (2) above, whereby the work relating to collection of license fee in the form of revenue share and maintenance of Financial Bank Guarantees in respect of various Basic and Cellular licences was decentralised to the respective offices of Controllers of Communications Accounts (CCA).

 

Subsequently, all the Basic Service licenses have migrated to Unified Access Service Licensing Regime, (except BSNL and MTNL).  Several new Unified Access Service Licenses have also been issued.

 

It has therefore been decided that, the collection of license fee and maintenance of FBGs  in respect of new Unified Access Service Licenses, in addition to existing Basic (now migrated to UASL) and Cellular licenses, will also being handled by the respective offices of the CCA or Jt CCA with immediate effect.

 

The FBGs in respect of new unified access service licenses (UASL) received in this office along with a copy of the concerned license agreement are being passed on to respective Communication Accounts Units in parallel.

 

2.                   Para 3.2 of this OM dated 8^th Dec 2003 (reference 2 above) may be seen.  The licensees have to make License Fee payments by Demand Draft or Pay Order.  These payments being of high-value must be deposited promptly in the concerned bank (preferably on the same day,) and the credit personally monitored by the head of the unit.

 

From June 2004 onwards, information about the date of receipt of license fee, date of deposit to the Bank and affording of credit by the Bank in respect of each receipt of the past month should be sent to DOT HQ.  The existing proforma for the monthly statement be augmented to include this information.

 

3.                   Instances have come to the notice of this office where quarterly payments from licensees have been refused on the plea that these were not supported by Affidavit and AGR statement.  It is clarified that under no circumstances should the license fee payments be refused.  However, the licensee shall be immediately handed over a letter informing him of his lapse and asking him to submit the required/prescribed documents within a week.  A sample format is enclosed herewith.

 

4.                   Your attention is further invited to this office letter under reference at (3) above.  In addition to the instructions therein you are required, for more effective control over Financial Bank Guarantees, to ensure that the Bank Guarantee Register is reviewed periodically by yourself and the other officers with at least a monthly review by you as the head of the Unit.  A monthly report should be sent to DOT HQ in the form of certificate from the head of the CCA unit, stating that Bank Guarantees have been reviewed during the month and there have been no lapses in this regard.  This report should invariably be sent in the first week of following month.

 

5.                   Computation of the FBG amount -- The practice presently followed to compute the amount of FBG is that the highest amount of Quarterly license fee paid by a licensee in the previous four quarters is multiplied by two and this resulted amount is enhanced by 10% to provide for expected growth in Gross revenue of Licensee Company in future.

 

It has been decided by the competent authority that henceforth an arithmetic mean, of the quarterly amounts of license fee paid by operators during the last four quarters, be taken as the base, (instead of the highest quarterly license fee), multiplied by two and the resultant enhanced as usual by 10% to arrive at the quarter of FBG to be demanded from the operator at the time of review.

 

The amount may be revised upwards in case the department considers it necessary to secure its interest.  A regular review of FBG's may however the carried out on a half yearly basis.  This will be applicable to all licensees under the revenue sharing regime.

 

With regard to reduction of FBG amounts following the reduction of license fee percentages announced by the government (ranging from 2% to 4% of the AGR) for the Cellular, UASL and Basic service licensees w.e.f. 1^st Apr 2004, the amounts of FBGs of these licensees are to be reviewed on the line suggested above immediately.  The outcome of such review in view of the reduction in the rates of license fee may however be implemented for a licensee only after ensuring that licensee has paid his dues up-to-date.

 

6.                   The heads of the Communications Accounts Units are also required to reconcile a license fee collected as is stated out in the monthly report with that recorded in the accounts of the Unit.  You are also requested to prepare a statement of such reconciliation for the year 2003-04 and forward the same to HQ within a fortnight.

 

7.                   The quarterly Affidavits and the AGR statements submitted by the licensees may be sent to HQ within a fortnight after retaining the original in your office.  The copy sent here may be duly authenticated.

 

8.                    All other past instructions remain unchanged except for those as stated by.

 

 

 

 

-S/d-

S. K. KAUL

Asst. Director General (LF-II)

Encl: a.a.