The Department of Telecom (DoT) has blacklisted Standard Chartered Bank from issuing bank guarantees (BG). The Department has sent a strong memorandum to all telecom operators and concerned officers to turn down BG issued by Standard Chartered. This is in response to the failed attempt at invoking the BG issued for Aircel Group.
‘Standard Chartered Bank has failed to invoke a BG issued by them on behalf of Aircel Group of companies. This action by Standard Chartered Bank is a serious breach of trust and contract with Government of India. In view of this you are directed not to accept any new BG from Standard Chartered Bank, including renewals,’ the note read.
The amount involved is yet to be disclosed.
Another bank that was blacklisted in March this year was Axis Bank. It failed to honor a BG issued to Bharti Airtel (Bharti Airtel was using Aircel’s spectrum) and was barred from issuing BG.
The Hindu cited a source saying that a TDSAT order on a dispute between Aircel and Telcom prevented Axis bank from invoking the guarantee.
Response by both banks
Both banks cited order passed by Telecom Disputes Settlement and Appellate Tribunal (TDSAT) for failure to make the specified payments. Though the details of the order were not specified.
Standard Chartered Bank spokesperson said, ‘Pursuant to an order passed by the TDSAT, we were unable to make payments with respect to certain bank guarantees invoked by the DoT. As per the said order, the invocations are not to be given effect to and the bank guarantees are not to be en cashed’.
Axis Bank spokesperson responded ‘Payment of the said guarantees, at present, will be in violation of the orders of the TDSAT. Once the order is vacated, the bank will be pleased to honor the said guarantees, as per the underlying terms’.