Nepal | October 31, 2020

Nepal Satellite Telecom’s licence scrapped

Sumargi’s NST has 35 days to challenge NTA decision in court

Sujan Dhungana
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Kathmandu, August 19

Nepal Telecommunications Authority has scrapped the licence of Nepal Satellite Telecom, which is also known as Hello Nepal, for not clearing its tax dues.

NST is owned by controversial businessman Ajeya Sumargi, who has often been dragged into tax issues. Earlier in May, the Inland Revenue Department had directed Sumargi-owned NST to foot Rs 4.31 billion capital gains tax out of the gains the company made while transferring 75 per cent of its share to TeliaSonera eight years ago.

“The NTA board had earlier directed NST to deposit the first tranche of its dues by August 18 and clear the remainder of the outstanding dues within three months of depositing the first tranche. In the event of NST failing to comply with this provision, the board’s decision states that NST’s licence will be automatically scrapped,” said Purshottam Khanal, chairperson of NTA, informing that NST’s licence has been revoked automatically as the telecom service provider failed to deposit the first tranche of its tax dues by August 18.

According to the telecom regulator, NST has failed to clear almost Rs 1 billion (royalty fee, licence renewal fee, frequency fee, service expansion fee and Rural Telecommunication Development Fund) to the government despite repeated calls from the authority.

Khanal said though NTA was not in favour of scrapping licences of telecom service providers, they were obliged to do so amid increasing tendency of telecom companies holding on to licences and not expanding telecom services accordingly and not clearing applicable tax dues to the government on time.

NTA had issued telecom service licence to NST in 2007. The Sumargi-owned company had been providing telecom services to a limited number of customers primarily based in the far-west region of the country. “Though NST had acquired licence to provide telecom services across rural areas, the company had not been expanding its telecom services in the desired manner in recent years,” said Min Prasad Aryal, spokesperson for NTA.

However, NST has the right to appeal against NTA’s decision within 35 days beginning August 18. “If NST does so, the court’s verdict will be final in relation to NST’s licence,” added Khanal.

According to the telecom regulator, several telecommunication service providers in the country, including NST, have not paid dues worth Rs 2.96 billion to the government. They include United Telecom Ltd, Smart Telecom, NST and BroadLink Network.

A version of this article appears in print on August 20, 2019 of The Himalayan Times.

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