Believe it or not, the Department of Telecommunications (DoT) is saddled with a staggering 2,800 legal cases, of which 435 are before the Supreme Court. And the other 2,365 cases are in high courts.
This, many say, makes the DoT one among the top departments when it comes to litigation though there is no independent data to vouch for it. To make it simpler, on any working day, lawyers representing the DoT would be arguing as many as 11 cases relating to the department’s financial demands challenged by telcos, disputes on interpretations of notifications and the law, and appeals for reversing a decision of lower courts.
Says a senior DoT official: “It is one ministry where there is always someone who is violating some direction or the other.”
Lawyers who have been involved in telecom litigation say the key reason is the strident position that department officials, on the one hand, and telcos, on the other hand, take on most key areas of dispute.
Says a senior lawyer who has fought many such cases for companies: “It emanates from a litigating mindset. And it begins with DoT officials, who are always looking at an interpretation of the law that helps them to make a financial demand that ensures maximising revenues. The approach in the department is not about resolving disputes but adversarial. Telcos are left with no option but to challenge it and it is this approach which has discouraged M&As as well as seen foreign investors moving out.”
He also points out that with telecom scams surfacing over the past few years, government officials prefer to play safe rather than be questioned, especially on imposing lower financial demands and coming under investigation.
Some say the clearance for the Vodafone-Idea merger is a case in point. The DoT initially gave two conditional clearances as long as the telcos paid their dues to the government. However, the two companies asked for a re-calibration of dues, which, they believed, was high — a request the department rejected.
Idea and Vodafone paid the dues, however, under protest and, experts say, have the right to challenge it legally. In the case of Bharti Airtel’s acquisition of Telenor, the DoT got clearance only after the Supreme Court endorsed a Telecom Dispute Settlement Appellate Tribunal (TDSAT) order that the clearance cannot be on condition that the telco pay its bank guarantees.-Business Standard