TELECOM
DISPUTES SETTLEMENT & APPELLATE TRIBUNAL
DATED
13th May, 2009
Appeal
No. 7 of 2007
Bharat
Sanchar Nigam Limited ……….. Petitioner
Versus
Telecom Regulatory Authority of
BEFORE :
HON’BLE MR. JUSTICE ARUN
KUMAR, CHAIRPERSON
HON’BLE MR. G.D.
GAIHA, MEMBER
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For Petitioner |
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Mr. Maninder Singh, Mr. Yoginder Handoo, Mr. Kunal Sood, Advocates |
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For Respondent |
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Mr. Saket Singh, Advocate. |
O R D E R
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1. |
The present appeal has been filed by the
Appellant impugning the direction of Telecom Regulatory Authority of India
(hereinafter referred as TRAI/Authority), purported to have been issued under
Section 13 of TRAI Act, 1997.
Appellant is a Public Sector Undertaking licensed to operate all types
of telecom services in the country excepting |
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2. |
The impugned direction under Section 13
of the TRAI Act, 1997 has been issued on 29th Aug, 2007 requiring
the appellant to furnish to TRAI, the number of subscribers adversely
affected and excess amount charged from the subscribers by reduction of the
pulse rate in landline calls originating from its network and terminating in
the network of Airtel from 180 seconds to 45 seconds in early October, 2005. This change in pulse rate has neither been
intimated to its subscribers nor was any publicity given. |
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3. |
The Authority has alleged that it had
forwarded a news item vide its letter dated 9th Jan, 2006 followed
by three reminders asking appellant specifically to clarify whether the
provisions of the Principal Tariff Order as amended by Telecommunication
Tariff (Thirty First Amendment) Order, 2004
(to be termed as TTO, 2004 in all future references)had been complied
with, while introducing the above changes in tariff and whether tariff was
implemented without informing the subscribers. |
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4. |
The appellant, issued a tariff order on 1st
September 2004 specifying the pulse rate to be adopted for calls originating from fixed line to
Wireless Local Loop (limited mobility) (to be termed as WLL(M) in all future
references) for inter circle calls and intra-circle calls for different
distances, as slab rates, to be
effective from 10th September 2004. This tariff order has been circulated to
all its units besides placing it on its web site. Subsequent to this order on 22-8-2005, appellant
has issued a circular including M/s
Reliance, M/s TTL, M/s HFCL and M/s Shyam also in the category of WWL (M)
service providers, while introducing 45 second pulse for all intra-circle
calls as applicable to Unified Access Service Provider (to be termed as UASP
in all future references) and 30 second pulse for all inter circle
calls. On 26-9-2005 appellant had
issued another circular which included M/s Airtel (Touchtel) to be also
placed in the same category as the
operators mentioned in the earlier circular dated 22-8-2005. The appellant has contended that, changes
in tariff have been made after a
period of six months and all these tariffs are available on BSNL web site.The
above explanation has been given by the appellant to the respondent in
response to its letter dated 2nd Feb, 2006 and thereby admitted to
have changed the tariffs vide Circulars No. 3-37/2004-R&C dated 1.9.04,
No. 3-15/2005-R&C dated 22.8.2005 and No. 3-15/2005-R&C dated 26.9.2005.
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5. |
The counsel for the respondent has
pleaded to clarify the intention behind the 31st amendment to the
TTO, 2004, by stating that this amendment
has carved out a class of consumers who have not completed six months
time in that particular tariff plan, which was opted by them, for availing
the service of the appellant. The
protection given by the amendment that, all subscribers who are within six
months of subscribing to a particular
package of a service provider, have to be treated as a separate class of
consumers, whose subscription plans cannot be changed for six months. Further interpretation given b y the
counsel of the respondent is that, the rates may be decreased but the rates of none of the items of a given plan, can be increased without giving six months
notice to the consumer. Another protection, that has been envisaged in the
TTO,2004 (31st amendment) is a direction to all cellular mobile
service providers and Unified Access Service Providers, is that the customer should be informed in
writing, within a week of activation of service, the complete details of his
tariff plan. In addition, as and when, there are any changes in respect
of any item/ tariff in the chosen package, the operator shall intimate, in
writing, such changes to those subscribers whose tariff packages undergo a
change. 6. The appellant’s reply of 18th
April, 2006 was examined by the Authority. The Authority observed that as per
the 31st Amendment of the TTO, any given tariff plan should be
available to the subscribers for a period of at least six months from the
date of enrolment. The service
provider during the currency of six months would also not be permitted to
raise any tariff. According to the respondent, the appellant has not properly interpreted
the 31st Amendment of the TTO.
The increase in tariff after a period of six months or more than six
months as intimated by the appellant is not the crux of the tariff order,
rather the main contention of this order, is to protect a class of subscribers, for a
period of six months after opting any particular tariff plan. The respondent’s view is that, in a dynamic
situation, several subscribers might have joined the plan just before the
proposed charges, and might not have completed six months in the existing
tariff plan. For such subscribers
also, the existing tariff must be ensured for six months. The subscribers, who are falling within the
period of six months and who have adopted a certain tariff plan, must traverse through that plan
uninterrupted for a period of six
months, before any change is effected which is to the detriment of their
interest. The main purpose of asking
for information as per the impugned direction, was to find out, as to how
many such subscribers, who have opted for 180 seconds pulse in the last six
months, have to perforce adopt a 45 seconds pulse as per the changed
circumstances by a sudden change effected by the appellant without any notice
or prior intimation. |
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7. |
The issues which arise for determination in this particular
appeal are as follows: (i)
Whether the classification of the
services as per the directions of the licensor resulting into the change of
the applicable pulse rate is in contravention of the TTO? (ii)
Whether there is a provision in the TTO
to accommodate such changes which are to be implemented in classifying the
service according to its characteristics which results into a change of
tariff? (iii)
Whether the implications of the
Interconnect Usage Charges Regulation dated 29th October, 2003
which envisages the payment of Access Deficit Charge (to be termed as ADC in
all future references) after
classification of the service as in WLL(M) category is possible to be met
with without realizing the same by changing the pulse rate as per the
classification of the service? (iv)
Whether the directions issued by the
respondent are legitimate in the facts
and circumstances of this particular case. |
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8. |
The counsel for respondent has contended
that the appellant responded to their letter dated 1st June, 2006 after
four reminders, on 4th Dec, 2006. The salient points of the response of the
appellant vide their letter dated 4th Dec, 2006 are as follows : (i)
The appellant issued circular no.
3-37/2004-R&C dated 1.9.04 for specifying the pulse rate for the calls
originating from BSNL fixed line service to fixed line, fully mobile and
limited mobile subscriber of BSNL as well as private operators. These terms were as follows : (a)
Pulse rate applicable ‘for local calls’ for
BSNL fixed line to fixed line service of any operator – 180 seconds. (b)
Pulse rate applicable ‘for
limited mobile service’ of private operators for local calls – 45 seconds. (ii)
The objective of this circular was to
achieve uniformity in raising the bills. (iii)
The appellant has also drawn the
attention of all operators about the directions issued by respondent that terminal
used for fixed wireless service should be strictly confined to the premises
of the subscriber where telephone connection is registered. All service providers should also ensure
that there is no misleading advertisement in the electronic and print media and
the media should be made to publicise the service as a mobile or limited
mobile service. The responsibility of
these actions was thrust upon the licensee and violation was actionable as
per the relevant clause of the license agreement. (iv)
The appellant has further drawn the
attention of the respondent about the clarification issued by the licensor
i.e. Deptt. Of Telecommunications, Govt. of India on 23rd March,
2005 addressed to all Unified Access Service Providers, it shall be treated
as WLL(M) – Wireless in Local Loop ( |
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9. |
The counsel for appellant has contended
that in view of the clarification of 23rd March, 2005 from the
Department of Telecommunication (The Licensor), it became obligatory for Unified
Access Service Providers to take necessary action in treating such services
not as fixed line service but as limited mobile service. The necessary action by appellant has,
therefore, been taken as per the instructions of the licensor in respect of
Interconnection arrangement. The
demand of ADC by treating this service as WLL(M) service has also been raised
as Interconnection Usage Charges vide Regulation, issued on 29th
October, 2003 regulating the payment of interconnection usage charges, for
telecommunication services, covering basic service that includes WLL(M)
services, cellular mobile services and long distance services (STD/ISD)
throughout the territory of India. The
Schedule-III of this Regulation mandates the payment of Access Deficit Charge
for fixed to WLL(M), WLL(M) to fixed, WLL(M) to WLL(M), WLL(M) to cellular
and cellular to WLL(M). After
10.3.2006 the IUC regime (Interconnection Usage Charges) changed
altogether. The methodology of
collection of ADC from per minute basis to a simple 1.5% of the Adjusted
Gross Revenue (AGR) of the operator has been implemented. The contention of the appellant is that,
it classified the service as WLL(M), which was capable of operating outside
the premises of the subscriber. The
consequential effect of such classification has led to the application of 45
seconds pulse vis-ŕ-vis 180 seconds pulse.
The appellant has further contended that, in no way it amounts to
change in tariff and, therefore, stipulation in the 31st Amendment
of the TTO, is not applicable. The appellant has categorically claimed that
change in the classification of service as per the direction of licensor,
having a consequential effect of change in the pulse rate, does not amount to
change in tariff plan. |
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10. |
The counsel for the respondent pleaded
that in spite of protracted correspondence with the petitioner, specific
queries were not answered in regard to the compliance of the TTO and,
therefore, it was left with no option but to issue the impugned direction of
29.08.2007 to seek information. The counsel for respondent also stated that impugned
direction, lists the complete background of the case, the provisions of the
TTO and rejects the contentions of the appellant expressed in various
communications and mandates the
appellant to furnish the required information. The counsel for the respondent also pleaded
that the Authority, in order to be transparent and fair, depends heavily on
the information provided by the service providers. He further pleaded that the impugned
direction does not impose any liability but only seeks information for the
sake of taking a decision in future. |
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11. |
The counsel for appellant reiterated that
there was no change in the tariff and it was only a change of classification,
which was necessary, as the walky phones were not WLL(Fixed) but WLL(Mobile)
and this was clarified by TRAI on 4th March, 2005 and the DOT on
23rd March, 2005 and 26th August, 2005. The appellant’s counsel vehemently argued
that the stand taken by the appellant was accepted by this Tribunal on
9.9.2005 and by Hon’ble Supreme Court in the Walky Cases. |
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12. |
The main submission made by the counsel
for respondent is that this Tribunal
and the Hon’ble Supreme Court of India have decided that walky phones are
WLL(M) and the clarifications issued by the respondent and the Department of
Telecommunication (Licensor) were clarificatory of the license and regulatory
provisions. It was further pleaded that the judgments held the clarifications
to be clarificatory in nature and the services to be WLL(M). It was also pleaded by the counsel for
respondent that there was no issue of change in tariff with respect to the
decision on the classification, however, if there is any increase, then in
what manner the same should be applied is the main issue. The counsel for respondent argued that increase
in tariff cannot be made ignoring the regulatory principles, governing the
increase in tariff, especially the 31st Amendment to the TTO,
notwithstanding the fact that such increase is a consequence of a judgment. The following case law were cited by the
learned counsel for respondent in
support of its contention: (a)
Bombay
Dyeing & Mfg. Co. Ltd. (3) v. Bombay Environmental Action Group,(2006) 3
SCC 434, at page 536 para 312. A judgment, it is well settled, cannot be
read as statute. Construction of a
judgment, it is well settled, should be made in the light of the factual
matrix involved therein. Any
observation made in a judgment, it is trite, should not be read in isolation
and out of context. (b) Mehboob Dawood Shaikh v.
State of Maharashtra,(2004) 2 SCC 362, at page 369 para 12. A decision is
available as a precedent only if it decides a question of law. (c) Union of India v. Major
Bahadur Singh,(2006) 1 SCC 368, at page 373 para 9-11. The observations of the Court are neither
to be read as |
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13. |
The learned counsel for respondent argued
that the content of the clarification issued by the respondent on 23rd
March, 2005 only stipulates that Walky shall be treated as a limited mobile
service; it does not, by itself, authorize the service provider, including
the appellant, to raise tariff
ignoring the provisions of the
TTO. The counsel also stated that
increase in tariff may be valid but has to be effected well within the
confines of the regulatory principles governing increase in tariff and the
judgment or clarification automatically do not override the TTO. The learned counsel for respondent has
extended the argument by saying that if the contention of the appellant is
accepted, it would make the 31st Amendment to the TTO redundant,
ineffective and otiose. It would
amount to reading in an exception against the object and purpose of the
provision. It was pleaded by the
learned counsel for respondent that
this is a situation where the tariff was not an issue before this Tribunal
and Hon’ble Supreme Court and is not under challenge in any forum. Finally, the learned counsel for respondent
concluded by saying that judgments may have the effect of justifying the
increase in tariff, but the same is not an authority for ignoring the
regulatory principles governing the
actual implementation of the increase in tariff. |
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14. |
The learned counsel of respondent has
also brought to our notice the following cases supporting its contention that
the object of the TTO is beneficial as it protects a class of consumers from
any kind of increase in tariff for first six months. The provision is mandatory and an absolute
bar with no exceptions. The words
being clear and unambiguous and being a tariff order the same need to be
given a literal meaning. (a)
Nathi
Devi v. Radha Devi Gupta,(2005) 2 SCC 271, at page 277 para 13-18; courts
are not concerned with the policy involved or that the results are injurious
or otherwise, which may follow for giving effect to the language used. If the words used are capable of one
construction only, then it would not be open to the courts to adopt any other
hypothetical construction on the ground that such construction is more
consistent with the alleged object and policy of the act. (b)
Nasiruddin
v. Sita Ram Agarwal, 9 SCC page 589 para 37; the
court’s jurisdiction to interpret a statute can be invoked when the same is
ambiguous. It is well known that in a
given case the court can iron out the fabric but it cannot change the texture
of the fabric. It cannot enlarge the
scope of legislation or intention when the language of the provision is clean and unambiguous. (c)
Easland
Combines v. CCE(2003) 3 SCC 410 at page 421 para 18. It is well settled law that merely because a law causes hardship, it
cannot be interpreted in a manner so as to defeat its object. |
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15. |
(i) The first issue is related to
the classification of service in the category of WLL(M). In our opinion the directive/communication
dated 4th March, 2005 issued by TRAI only re-emphasizes the
position mentioned in the IUC Regulation dated 29th Oct, 2003,
namely that a fixed wireless terminal, if not confined to the premises of
subscriber, will invite mobility within Short Distance Charging Area(SDCA),
which in turn would attract ADC charges on such services. The definition of the WLL(M) is provided
for, in the IUC Regulation of 29th Oct, 2003 in clause 2 (xxviii)
which classifies the limited mobility telephone service to operate within a
short distance charging area by using the wireless technology in the local
loop. The implication, thereafter, is
to change the pulse rate of the calls and to put them in the appropriate
category. This category is already
specified by the appellant vide their circular no. 3-37/2004-R&C dated 1st
Sept, 2004. The contention of the counsel for appellant is that this is not a case of increase in
tariff but only of change of pulse rate which was mandatory. The contention
of the counsel for respondent is that the classification of subscriber as per
the TTO is well within the powers of the respondent under Section 11(2) of
the TRAI Act. It was argued that the classification
has also been created to protect the interest of subscriber in a multi
operator scenario in which the subscriber has to choose the most beneficial
tariff plan, before taking services from
any operator and to remain unaffected for a period of atleast six
months. The change in category of a service,
having consequential liability like ADC etc., should protect the subscriber
as well as the operator. In the
present circumstances we find that the categorization of service from WWL(F)
to WWL(M) is on an immediate basis without envisaging any protection to a
particular class of subscriber as per TTO who have not completed their tenure
of six months period in their adopted tariff plan. We are, therefore, of the view that the action taken by the appellant is
appropriate. (ii) We have gone through the
provisions of the TTO alongwith the explanatory memorandum. The objective of
the 31st Amendment is to achieve transparency in publishing and
implementing the tariff and in billing the subscribers, which is necessary to
be ensured because of the multiplicity of the plans in a multi-operator scenario. The respondent has also not tried to
regulate the number of tariff packages offered by the Access Provider, in
view of the dynamic situation in the market on account of intense
competition. The purpose for which,
this amendment in the TTO has been issued, is laudable and, is in the
interest of the subscriber, however, the instructions of the licensor and the
categorisation of service by the respondent in the instant case, have not
kept in view a particular class of subscribers to be immune to any change of
tariff. This aspect, if mentioned
while issuing the change in classification of service by the licensor would
have given the necessary protection to the subscriber and thereby maintaining
the provisions of the TTO. In the present circumstances, we think that
there was no other option with the appellant except the action taken by it. (iii) It is a fact that the Interconnect Usage
Charges Regulation dated 29th Oct, 2003 envisages the payment of
ADC after classification of the service in WLL(M) category. The methodology of collection of ADC has
also changed from per minute basis to a simple 1.5% of Adjusted Gross Revenue
(AGR) of the operator in March 2006.
In any case the call charges have, therefore, to accommodate the ADC
payment until and unless, the operator decides to absorb it as a business
preposition. The decision about fixing
tariff normally takes care of all such charges which are payable as per the
prevailing regulations and, therefore, as soon as this service is classified
as mobile service, the charging of ADC as a component of tariff is a normal
practice adopted by all the operators.
It is a fact that liability of each operator for its subscriber for
payment of IUC/ADC is inevitable until and unless there is a specific
provision made for the subscribers who become immune to change in tariff
because of the TTO. (iv) The directions issued by the respondent in the present circumstances are in
conflict with its own instructions of classifying the service in WLL(M)
category without making any exception to the class of subscriber created in
the TTO for providing protection against change in tariff plan before the
expiry of six months and, therefore, in the instant case the direction issued
by respondent is not tenable. |
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We uphold that the classification of
service as WLL(M) (Wireless Local Loop Limited Mobile Service) according to
the direction of licensor resulting into the application of pulse rate is as
per the prevailing orders of the licensor as well as of the respondent. As per the TTO the respondent has created a
class of subscribers, who have not completed the six months duration in a
particular tariff plan. This
classification is well within the powers of the respondent under section 11(2)
of the TRAI Act. The intention of making
such classification is to protect the interest of the subscriber in a
multi-operator scenario, offering several options, which requires a concerted
effort on the part of the subscriber to choose the most beneficial plan,
before taking services under a particular tariff plan. The subscriber does not expect to be hurt
atleast for a period of six months after adopting a particular tariff
plan. This implies that, the
subscriber belonging to this class should be protected from change in tariff
on account of the instructions of the respondent as well as the licensor,
and, therefore, while issuing the orders for effecting a change in the
category of service, having consequential liability like ADC etc., there
should be a specific mention that, as per the TTO, the class of subscriber
which is within the period of six months time, after adopting a particular
tariff plan, is insulated from these changes.
In the present circumstances, however, we find that the instructions of
the licensor and the respondent are to implement its decision
immediately. There is no specific
reference to exempt a class of subscribers who have not completed the period
of 6 months. We
find that the Appellant has not changed tariff per se but has only changed the pulse rate as per the
classification already in vogue. This
exercise has been carried out by the appellant as per the direction of the
licensor. The instructions of the
Respondent which, inter-alia required the licensee of the fixed wireless
service provider to strictly confine to the premises of the subscriber has
not been followed and the Appellant has attracted the classification of being
a limited mobile service operator as per the judgment of TDSAT as well as the
Respondent. Had it not done so, the
Appellant would have attracted the charge that it was not levying the proper
tariff and thereby depriving the Government of license fee/taxes on Adjusted
Gross Revenue (AGR) as well as defaulting on ADC payments. We, therefore, hold that this is a peculiar
case where the Appellant was obliged to change over to the new pulse
rate. It could not have, in the
circumstances, done otherwise, than what it did. The only thing that can be said is that it
could have informed the same to the Authority while carrying out the change
of pulse rate. But, it would not have
been possible for the Appellant to wait for 6 months even in respect of a
restricted number of subscribers, not to change the pulse rate. It would have only resulted in avoidable
confusion. We, therefore, direct that
no further action is necessary in pursuance of the Respondent’s Direction
dated 29.8.2007. The question remains whether the
Direction itself was valid. In a
normal circumstance, such a Direction would be valid, since, as maintained by
the counsel for Respondent, the Tariff Order is the only protection for the
consumer. But, this is an
extraordinary situation. We,
therefore, feel that, in this case, further action is not called for. We also direct that when such a situation
arises, where a service operator is legally bound to effect a change, it
shall do so by simultaneously informing the Authority. The appeal is disposed of accordingly
with no costs. M.A. also stands
disposed of. |
…………………….J
(Arun Kumar)
Chairperson
………………….
(J.S. Sarma)
Member
………………….
(G.D.
Gaiha)
Member