Reliance Communications demand Rs 70 crore from S Tel for network infrastructure use

NEW DELHI: Reliance Communications, India's second largest telecom company by subscribers, has moved the telecom tribunal to recover 70 crore from S Tel for using network infrastructure and towers belonging to Reliance Infratel.

According to a person familiar with the proceedings, RCom approached Telecom Disputes Settlement and Appellate Tribunal on Wednesday seeking returns from S Tel, which had entered into two agreements with RCom and Reliance Infratel in 2009.

S Tel has recently begun winding up operations in India after the Supreme Court cancelled 122 mobile permits belonging to eight telecom companies, including S Tel, which it received in 2008. S Tel held six 2G mobile permits in Bihar, Orissa, Jammu & Kashmir, Himachal Pradesh, the Northeast and Assam and 3G spectrum in Bihar, Orissa and Himachal Pradesh circles.

Bahrain Telecommunications (Batelco), which had 42.7% stake in the joint venture, decided to sell back share to S Tel promoter C Sivasankaran for $ 175 million - the same amount it had bought the stake in 2009 - shortly after the judgement. Abu Dhabi-based Etisalat, which entered into a joint venture with DB Group, also announced its exit from India.

On Tuesday, S Tel wrote to Prime Minister Manmohan Singh to surrender second generation (2G) and third-generation (3G) mobile permits including the telco's infrastructure for return of 1,700 crore that it had invested in C circles along with Batelco.

"We are ready to submit to an independent audit to validate our claims for returns of our investments," Sivasankaran said in the letter. S Tel also said that it had not added a single customer to its 3.5-million subscriber base since the verdict, and had offered its customers to move to another network using mobile number portability.