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Attorney General Backs DoT Power To Slap Penalty On 2 Telcos

In a setback for Bharti Airtel and the Vodafone-Idea, Attorney General K K Venugopal has backed the power of the telecom department to slap a Rs 3050 crore penalty on the mobile operators recommended by regulator TRAI — over the issue of interconnect provision to Reliance Jio.

Also, power of the regulator in recommending such a penalty have been upheld by the legal adviser and the joint secretary in the department of telecom, who have said the same should be imposed immediately to save any losses to the exchequer, official sources told TOI.

The AG was asked whether the department of telecom that issues licenses to mobile companies can agree with the views of the regulator and go ahead with slapping the penalty. AG also refused to draw a parallel to a case filed in the Tripura High Court by Dishnet Wireless where power of the telecom department in issuing a penalty had been questioned.

A final decision on imposing the penalty is currently being studied by the interministerial Digital Communications Commission (DCC), which is expected to conclude the matter soon.

TRAI had in October 2016 recommended a penalty of Rs 1050 crore each on Airtel and Vodafone India (Rs 50 crore each in 21 telecom circles), and Rs 950 crore on Idea Cellular (Rs 50 crore each in 19 circles). Vodafone and Idea have since merged and the new entity faces a penalty of Rs 2,000 crore.

While a section of the telecom department (four members out of a committee of seven) did not agree with the views of TRAI, and said the issue should be dealt with by the Telecom Disputes Settlement and Appellate Tribunal (TDSAT), three other members had backed TRAI and said the regulator had the power to recommend a financial penalty.

They had agreed with TRAI that “non-compliance (by Airtel, Vodafone and Idea) was intentional and had ulterior motive of stifling the competition and was against the public interest.”

In its recommendation for penalty, TRAI had also said the older mobile companies had moved with the “ulterior motive to stifle competition”, which resulted in a massive depletion in quality of services on Jio network, causing huge inconvenience to its subscribers, who failed to connect calls.

Jio, which began services in September 2016, had blamed the then call failures on its network running into crores on a daily basis — on the incumbent operators, though the latter had said there was a massive asymmetry of traffic emanating from the new entrant as it was providing free calling services.―Times Of India

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