DoT panel sought slow ball,Bharti got bouncer

In SLD services,a customer's phone usage while roaming would be treated and billed as local.

Written by Rishi Raj | New Delhi | Published: July 17, 2013 3:17 am

Inlevying a stiff penalty of R650 crore on Bharti Airtel for providing a facility termed subscriber local dialling (SLD) way back in 2002-03,the department of telecommunications (DoT) has gone against a report of its own special committee which had recommended a mere R12 crore.

According to the committee’s report,a copy of which is with FE,the suggestion was to levy R5 lakh per circle (services were offered in 13 circles) for the period during which the services were provided (18 months). However,DoT imposed a fine of R50 crore for each of its 13 circles,the maximum which can be levied for violation of licence conditions,taking the amount to R650 crore.

In SLD services,a customer’s phone usage while roaming would be treated and billed as local.

Arguing that the services — though in violation of the licence terms and conditions — did not merit the harshest penalty,the committee had said that tariffs for the scheme was reported to and approved by the Telecom Regulatory Authority of India and licence fees were paid to the government. The company did not charge the customers long distance tariff; so,there was no willful gain made by it.

Since it did not use the long distance network of BSNL,there was no loss to the state-owned telecom firm either. The final conclusion was that there was no dishonest intention behind the scheme,“therefore,this is not a case which merits severest of severe financial penalty.”

According to Bharti,the SLD services fetched a mere Rs 8,62,000 in revenues. However,since it was unable to submit call data records (CDR),the committee could not verify the amount. Rules stipulate maintaining CDRs for just one year; so,there was no way they could have been produced.

The wide gap between what the special committee appointed for the purpose suggested way back in 2009 and what the DoT finally levied on the company has once again confirmed industry apprehensions that in every perceived case of violation,minor or major,the tendency by the officials is to levy the highest slab of penalty.

Licence provisions say that for any violation of terms and conditions,a penalty of up to Rs 50 crore can be levied. Vodafone India managing director and CEO Marten Pieters told FE last week that it was disturbing to see a trend where for any alleged violation,the uppermost slab of fine is levied. Pieters was speaking in the context of around Rs 20,000 crore of fine levied on the company,all of which is under litigation.

A Bharti statement said last week: “Bharti Airtel is shocked and disappointed to receive a demand notice of Rs 650 crore from the DoT pertaining to the service of SLD to its subscribers between 2002 and 2005. Bharti Airtel believes that the demand for penalty of Rs 650 crore is devoid of any merit and has no justification both on facts and in law.”

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