Corporate Oct 15, 2012
The Department of Telecom is likely to send a supplementary show cause notice to Bharti Airtel for transferring its tower business to Bharti Infratel, reports CNBC TV18's Malavika Jain.
Bharti Infratel is the tower arm of the telecom giant which is launching its initial public offering in 2012 and is planning to mop up nearly $1 billion in the country's biggest IPO in more than two years.
DoT's action is based on a special audit done of FY 2007 and 2008 where the department sources say that the difference between book value and fair value of the tower business was not shown andBharti had transferred its tower business at nil value after approval from the High Court.
This exclusion of the tower business lowered Bharti's revenue which impacted government collection.
Meanwhile, the company has said that there has been no communication with regards to the show cause and said that the scheme of transaction was approved by the Delhi High Court. The company has said that it is in complete compliance of all regulations.
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