No change to rule for Tata: Centre

Seeking to steer clear of the ongoing $1.17 billion Tata-DoCoMo payment dispute, a top official on Wednesday said the government has no role to play as it can’t “change the rule to suit the convenience of somebody” in a case that is based on agreement between two private parties.

“The government has no role in it. It was a bilateral agreement between two parties. We can not change the rule to suit the convenience of somebody,” said a top Finance ministry official.

“The agreement was the violation of the FEMA rule. Both of you decided to enter into an agreement, you can not expect government to change its rule to suit your requirements. If small guy comes, will anybody talk about them. It is for now them to sort it out,” he said.

NTT DoCoMo in 2008 acquired 26.5 per cent stake in Tata Teleservices for about Rs 12,740 crore (at Rs 117 per share). This was as per understanding that in case it exits the venture, it will be paid a minimum 50 per cent of the acquisition price.

When DoCoMo decided to exit the joint venture, which struggled to grow subscribers quickly, it sought '58 per share or Rs 7,200 crore from the Tatas.

But the Indian group offered Rs 23.34 a share in line with RBI guidelines which state that an international firm can only exit its investment at a valuation “not exceeding that arrived at on the basis of return on equity”.