TDSAT has set aside the penalties imposed on the new telecom companies by the DOT for not rolling out services in time, as per the licence agreement. It also asked the DOT to refund the penalty amount collected from the companies. This order will benefit Sistema Shyam, Loop Telecom, Uninor, Etislat etc.

According to licence conditions the telecom companies have to cover 10% of the district headquarters  in a telecom circle within the first year after allotment of spectrum. If the roll out is not made even after one more year, the penalty can be imposed. The DOT had imposed the penalty and collected the same from these private telcos. Altogether an amount of Rs. 350 crore has been collected towards penalty.

As per the TDSAT order the licences can not be cancelled and the penalty already collected should be refunded to them.