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FM cos refuse to pay govt dues

27-April-2004
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FM cos refuse to pay govt dues

Private FM radio samurais don’t want to pay up the Rs 110 crore they owe the government. They expect the new government to take a lenient view of their dues. Bureaucrats at the ministry for information and broadcasting are in no mood to oblige. They refuse to be lenient and be accused of favouritism by the Election Commission or the next government.

The due date for annual payments of FM radio licence fee is April 29. The eight players involved cover 13 cities.

Sources said various FM radio players have intensified pressure on the government to get the deadline extended. Representations apart, some have threatened legal action.

Entertainment Network India Ltd (ENIL), which operates Radio Mirchi, has already sought an injunction against the government from encashing its bank guarantee. The case is up for hearing in the Mumbai HC on Tuesday.

The government had told FM players that the deadline won’t be extended.

FM operators, who refused attribution, justified their methods. They expect a softer set of rules to come into place. These have been framed under FICCI secretary-general Amit Mitra and include a migratory scheme to revenue sharing.

Reacting to the developments, radio analyst Sunil Kumar said: “The second phase will usher in the real radio market. A metro-centric industry is rather unusual.” According to Mindshare MD Ashutosh Srivastava, “the next phase is pretty clear. It’s the first round which saw so much of grief”.

The Mitra committee pegged the revenue share at 4 per cent of the gross revenue. The government hasn’t issued fresh guidelines. The recommendations have been parked with the Telecom Regulatory Authority of India. Government officials argued that fresh guidelines can be made only when the the new Cabinet approves them. The private players include Entertain-ment Network India Ltd, Radio Mid-Day and Music Broadcast Pvt Ltd, among others.

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