Govt to notify graded penalty system for telcos soon: Ravi Shankar Prasad

The department of telecommunications (DoT) has so far served around Rs 8,000 crore in penalty notices to telcos. Most of these resulted in litigation, which includes 3G intra-circle roaming issue among others.

By: ENS Economic Bureau | New Delhi | Published:January 5, 2016 2:34 am
Ravi Shankar Prasad, Minister of telecom at the Indian Express idea exchange in Noida on August 14th 2015. Express photo by Ravi Kanojia. Minister of telecom, Ravi Shankar Prasad. (Express photo by: Ravi Kanojia)

Telecom minister Ravi Shankar Prasad on Monday said the government will soon notify a graded penalty system for the wrongs of telecom companies that would bring in some rationality to monetary penalty, which is a flat Rs 50 crore right now.

The minister explained that the differential penalties would range from as low as Rs 1 lakh for minor violations and progressively rise to Rs 1 crore, Rs 5 crore, Rs 20 crore, and finally up to Rs 50 crore, depending on whether the offence is moderate, major or severe.

The department of telecommunications (DoT) has so far served around Rs 8,000 crore in penalty notices to telcos. Most of these resulted in litigation, which includes 3G intra-circle roaming issue among others.

The new rules will also allow a telecom companies to appeal against the penalty to the Department of Telecommunications (DoT). The issue had been pending since 2012, even as the government had approved on rationalising the penal provisions against telcos. Prasad’s predecessor, Kapil Sibal had promised to come out soon with graded scheme for penalty on telcos for violation in May 2012. The issue was further stuck due to parliamentary elections which was held during April-May 2014.

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Since then, the telcos had been demanding for immediately putting into place differential penalties for violation but that kept lingering on for reasons, which the government has not been able to explain. Telcos have repeatedly complained for even minor violation, the DoT imposed a penalty of `50 crore which is unfair.

The new norms are a consequence of the Telecom Commission’s decision on April 2011, on the recommendations of a April 2008 committee headed by the then DoT’s additional secretary, who had also suggested a number of major changes including a uniform licence fee.

Sibal had said the penalties should be based on the gravity of the violations and if mindlessly the maximum penalty is imposed in each particular case, it would send a wrong message to the industry. The Telecom Regulatory Authority of India in its recommendations on the guidelines for the unified licence and migration to the new licence, in April 2012, had suggested that the maximum penalty be reduced to Rs 10 crore. FE

Trai to give suggestions on spectrum pricing by January 15

New Delhi: The Telecom Regulatory Authority of India (Trai) is expected to give its recommendations on the reserve price of different spectrum bands for the next round of auction by January 15.

After the conclusion of open house discussion on Monday, Trai chairman R S Sharma said the discussion was productive where all the stakeholders put across their views and comments. FE

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