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Vodafone Idea petitions India's telecom tribunal to recover bank guarantees

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Vodafone Idea petitions India's telecom tribunal to recover bank guarantees

Vodafone Idea Ltd. has moved India's telecom tribunal to recover bank guarantees worth 33.22 billion rupees, paid to secure government approval for its merger with Vodafone Group PLC unit Vodafone India, The Economic Times reported, citing a petition copy.

The guarantees were reportedly provided to the country's Department of Telecommunications for one-time spectrum charges "under protest."

Vodafone Idea has also requested the Telecom Disputes Settlement and Appellate Tribunal to nullify a clause in the M&A rules which states that the department can seek bank guarantees for an amount equivalent to the demand it has made regarding one-time spectrum charges, according to the report.

The newly formed telco called the bank guarantees demand "arbitrary, discriminatory, illegal and unenforceable."

The tribunal will hear the matter Oct. 20.

The telecom department had granted a conditional nod to the merger of Vodafone India and Idea Cellular, now Vodafone Idea, in July. It sought bank guarantees of more than 33 billion rupees from Idea Cellular as a one-time spectrum charge and 39 billion rupees from Vodafone India for the market price of administrative spectrum less than 4.4 MHz.

Vodafone Idea had also written to the department to recalculate the spectrum dues, the report said.

As of Oct. 10, US$1 was equivalent to 74.25 Indian rupees.