According to the DoT, the interest of the existing licence holders will be fully protected even if the licences are surrendered. The DoT has also rejected all the revenue sharing proposals on the grounds that it would be close to impossible to arrive at the qauntum of revenue share. Officials are also of the view that it would be difficult to defend such an action before the Comptroller & Auditor General.

To begin with, assets of a cellular/basic licence holder will be evaluvated by an independent andmutually acceptable valuer. The assessment will cover the total investments made by the existing licence holders in their respective circles. This evaluation will take into account all expenses, including future commitments, before arriving at a figure.

Once this is accomplished, companies will have to surrender their licences in order to pave the way for fresh bids in the telecom circles.

This will be followed by a fresh round of bidding, which will be open to both the old licencee and new applicants. The bid will be awarded to a company on the basis of the highest revenue share offered.

As a result of the new bidding process, if old licencee posts the higest bid (in terms of revenue sharing parameters), the licence will go to him. However, in the event that a new applicant wins the bid, he will have to pay off the old licence holder.

The amount to be paid will be equivalent to the assessed value of the assets made by the independent evaluator.

DoT officials feel that this was the best possiblemethod of resolving the issue to the satisfaction of all concerned parties. Sources said that such a step will also nullify the risk of litigation.

What is more, the DoT is providing a so-called escape route. Sources said that the Prime Ministers Office (PMO) has favoured the proposal, as it felt that this move would meet the demands of industry while guarateeing revenue flows and meeting the objectives of the new telecom.

The fresh proposal to resolve the telecom tangle is likely to find favour with Sorabjee this time around, as he had in the past expressed inability to come up with a different opinion on the basis of references by the department of telecommunications.

The AG has taken up the issue after the Prime Ministers Office directed DoT to come up with a new set of solutions. Chairman of Telecom Commission Anil Kumar who returned to Delhi on Wednesday from an overseas trip, held a meeting of the full Telecom Commission in Sanchar Bhavan to discuss the issue. Sources said that this was the firstmeeting of the commission after the change in guard at the ministry.