Regulators

Sun Group challenges denial of permission to bid for FM Phase III auctions in Chennai & Delhi High Courts

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NEW DELHI: The Sun Group’s challenge to denial of permission to participate in auction for Phase-III of FM radio broadcasting licences is expected to be heard both by the Madras and Delhi High Courts on 21 July, 2015. 

The Group, in the petitions filed today (20 July), has also sought a stay on the order of the Information and Broadcasting (I&B) Ministry in this regard. The Ministry had last week issued a list of 21 bidders, which did not include the Group’s Red FM, and then sent a formal communication to the Group on 15 July that it had been denied permission. 

The Court has been asked to direct the Centre to permit Sun Group to migrate to the Phase-III regime by allowing it to resubmit the application dated 20 March, 2015 to participate in the auction.

When asked how case on a similar issue could be filed simultaneously in two High Courts, a spokesperson of Sun Group said the petitions have been filed by different companies which are part of the Group.

A set of six writ petitions, which include three each by the company and the shareholders, has sought permission to resubmit its application to participate in the tender.

The petitions also said the company was not involved in any dispute with the nation's security, nor had it broadcast anything that affected the security of the nation.

The petition alleges that the order denying permission had been issued “carelessly, with total non-application of mind and in a cavalier fashion, totally unmindful of its consequences and repercussions not only on Sun TV but also on the entire broadcasting and media industry.”

Apart from the denial to participate in Phase III FM auctions, the order also implied that the sister companies of the Sun Group would be compelled to close down FM radio stations, totalling 45 across the nation, the petitioners said.

“Non-inclusion of the company's name on the list is nothing but closing the entire FM stations run by it for extraneous, illegal and mala fide reasons,” the petitions said.

It has pointed out that the Indian Telegraph Act does not make any mention of security clearance, and licence can be terminated or denied only if there is violation of the terms of the agreement including any defaults in payment.

Clause 2.2(b) of the Information Memorandum and Clause 3.2(b) of the Notice Inviting Application says only a company controlled by a person convicted for an offence involving moral turpitude or money laundering or drug trafficking or terrorist activities or is declared as insolvent will not be eligible to apply. The petitioners said there was nothing in the rules to deny permission the the Sun Group, which is controlled by the Maran brothers.

Some financial cases – with no relation to the nation’s security - are pending against the two brothers but nothing has been proved, a Sun Group spokesperson told Indiantelevision.com.

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