An inter-ministerial panel is learnt to have rejected the Sun Group's application to participate in the next-stage FM radio auctions, indicating that the licence renewal request of the Chennai-based network's 33 TV channels — hanging fire after home ministry denied them security clearance — could suffer the same fate.
Top government sources said that phase 3 FM auctions would go ahead without the Sun Group that operates 45 FM channels under the brand name Suryan FM in Tamil Nadu and Red FM in other cities. Sun is the only applicant left out from the auctions for lack of security clearance, while two other organisations were rejected on technical grounds, sources said.
The government's actions could result in a delay in the FM auctions, industry sources said, as Sun was likely to move court against the decision. The decision would also mean that the government had decided to ignore the opinion of Attorney General (AG) Mukul Rohatgi, who had ruled that home ministry decision denying security clearance was incorrect.
The decision to go ahead with the FM auction without the Sun Group is learnt to have been made on Tuesday at the Application Review Meeting consisting of representatives of various ministries. The committee, comprising officials from finance and law ministries and departments of industrial policy and promotion and telecom approved 25 other participants who had applied for the auction.
The Sun TV issue had grabbed headlines after ET reported last month that the Ministry of Home Affairs (MHA) had denied security clearance to the group, citing concerns over "economic security", an upshot of the investigations by various government agencies against its promoters Kalanidhi and Dayanidhi Maran.
Apart from the FM channels, the MHA had spiked a proposal by the I&B ministry for giving security clearance to 33 TV channels of Sun Group. Experts say a show-cause notice may be issued to the company regarding its TV channels in the next few days.