After Contentious Delay, DCC to Decide on Rs 3,000 Crore Penalty for Airtel, Idea and Vodafone

While there have been mysterious delays, sources say that the final note before the DCC proposes accepting the regulator's recommendations.

New Delhi: The highest decision-making body in India’s telecom ministry will meet on Thursday to finally decide on whether to accept the recommendations made by the telecom regulator over slapping a whopping Rs 3,050 crore fine on three incumbent telecom players for not giving points of interconnections (PoI) to new operator Reliance Jio.

According to sources, the Digital Communication Commission (DCC, earlier called the Telecom Commission), will take a final call on TRAI recommendations imposing penalty on the three operators “on violations of provisions of licence agreement and the standards of quality of service of Basic and Cellular Mobile telecom service regulations, 2009”.

In October, 2016, the Telecom Regulatory Authority of India (TRAI) had recommended imposing penalties on the three operators as they didn’t provide enough POIs to Reliance Jio, which resulted in poor quality of services.

Also read: How Reliance Jio’s Entry Tied Regulatory Knots Around India’s Telecom Ecosystem

In a telecom network, PoIs allow calls to transfer from one network to another.

What has added to the confusion is that the telecom department has taken unusually long time – two years and four months – in taking a call on a decision that will have financial implications.

However, sources say that the final note before the DCC proposes accepting TRAI’s recommendations.

It is based on the opinion of the attorney general and vetting done by the legal advisor of the department. The decision also has the nod of DoT secretary Aruna Sundararajan, two former telecom commission members (technology) G.K. Upadhyay and Prabhash Singh (who signed the reports as chairman of the committees), S.S. Singh, present member (technology); Anuradha Mitra, member (finance) and P.K. Sinha, advisor (finance).

“DoT may have taken long time but it has ensured that its decision is 100% legally compliant. Incumbent players have been given enough opportunity to present their case by TRAI and the DoT committee. Now, there is no scope of delaying the decision,” said a source who is familiar with the whole case.

The incumbent players have said that it is not within the jurisdiction of the TRAI to impose penalty and it is a dispute between two operators.

However, an AG opinion in 2016 says that the regulator does have the requisite power. A Supreme Court verdict in 2018 also reiterated TRAI’s powers. Later, the legal advisor also vetted DoT’s decision.

What has raised eyebrows, however, is a long delay in taking a decision by some DoT officials.

Sources said that former member (technology) Prabhash Singh raised concerns through a note written to the secretary: “The said report has been signed by undersigned as the chairman of the committee along with two senior most members ….. the said remaining four members of the committee are neither inclined to sign nor have given any reasons for not signing the said report as yet.”

In the note that was written just a few days prior to his retirement, Prabhash Singh noted:

“Further, it seems that when the undersigned is going to retire on 30th September, 2018, the defaulting TSPs in the instant case are again deliberately being kept informed and instigating by some of the offending members of the committee only to make these TSPs write further request letter at the eleventh hour for further hearing/opportunities on some or the other pretext thus wilfully hampering the logical conclusion of the said penalty case involving imposition of penalty of Rs 3,050 crore on these defaulting licensees. Their intention seems to repeat the story of last year by adopting the same tactics for delaying closure of the report so that chairman of the committee retires by 30th September, 2017. In view of the above, the report duly signed by the three senior most officials in the committee should be taken as final….”

In the same note he mentions:

“representations dated 30th October, 2017 [the day when G K Upadhyay, chairman of the first committee was to retire] were received from defaulting licensees requesting for an opportunity for personal hearing. Their request was later agreed to by the competent authority… [even though five members out of seven including chairman had signed the report].”

Later, when Mr Singh retired and S.S. Singh became member (technology), he directed remaining four committee members to either sign the report or submit separate their own report. The four junior members of the committee submitted a report that basically questioned TRAI powers to recommend penalty.

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DoT examined both the reports and on the basis of AG’s opinion, and vetting by legal advisor, finalised a note that will be considered by the DCC in its meeting on Thursday.

The DCC is the highest policy making body in the telecom sector. The secretary to the Government of India in the Department of Telecommunications is the ex-officio chairman. The full-time members are member (finance), member (production), member (services) and member (technology).

The part-time members of the commission are CEO, NITI Aayog, secretary (department of economic affairs), secretary (ministry of electronics and information technology) and secretary (department of industrial policy and promotion).