Telecom stocks weak after High Court Order

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Telecom stocks weak after High Court Order
Telecom stocks were trading weak today after a High Court Order upholding permission to the Comptroller and Auditor General to audit revenues of telecom companies.

Shares of Reliance Communications was down 1.2 per cent, while Bharti lost 0.5 per cent, while Idea Cellular was marginally down in trade.

A few years back the Comptroller and Auditor General had sought revenue details of companies from the telecom sector to examine whether they under-reported their revenues, causing losses to the government. It may be noted that telecom companies share revenues with the government, and hence under reporting impacts government revenues.

The High Court rejected the separate petitions of Association of Unified Telecom Service Providers (AUSPI) and Cellular Operators Association of India (COAI) filed against the decision of telecom tribunal TDSAT on the issue in 2010.

Both the associations had argued, in essence, that CAG can't audit private companies.

The high court had reserved its order in November 2013, after conducting marathon hearings on the issue where it took on record submissions of the Centre, CAG and the petitioners - COAI and AUSPI.

With inputs from PTI

Read more about: telecom, idea celleular, bharti airtel
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