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Vodafone moves Delhi HC against Trai’s bid to impose penalty of Rs1,050 crore

Trai’s recommendation based on a complaint by Reliance Jio which alleged that Vodafone had refused to comply with points of interconnection norms


Photo: Mint
Photo: Mint

Vodafone Mobile Services Ltd moved the Delhi high court on Friday, challenging the Telecom Regulatory Authority of India’s (Trai) recommendation to the centre that a penalty of Rs50 crore per circle be imposed on the telecom company for violating terms and conditions relating to points of interconnection among service providers.

With a presence in 21 circles, Vodafone is liable to pay a total penalty of Rs1,050 crore.

Trai’s recommendation was made to the department of telecommunications (DoT) on 21 October and is based on a complaint by Reliance Jio Infocomm Ltd which alleged that Vodafone had refused to comply with interconnection norms. The regulator also recommended a Rs50 crore penalty on each of Airtel’s 21 circles, and Idea’s 19 circles, where points of interconnect congestion exceeded the permissible limit of 0.5%, according to a Mint report of 22 October.

Trai issued a show cause notice to Vodafone for non-compliance with interconnection service norms on 27 September and gave the company 10 days to respond. It held a meeting in this connection on 30 September.

In this regard, Vodafone told the court that Trai had compromised on principles of natural justice by holding the meeting before the 10-day response period had elapsed.

Justice Sanjeev Sachdeva, before whom the matter was brought, asked the regulator to seek clarifications on why it had not waited for the company to respond.

Seeking a stay on the impugned recommendation, Vodafone submitted that there was nothing in the Telecom Regulatory Authority of India Act, 1997, that permitted imposition of the penalty, and added that it was entirely “arbitrary and unconstitutional”.

“The telecom authority must act within the four corners of the statute. It is a recommendation which is prejudicial to the interests of the company,” said Rajiv Nayyar, counsel for Vodafone.

Nayyar sought a stay on the recommendation and urged the centre to take any other action it deemed fit, independent of the recommendation.

Vodafone also pointed out that imposition of such penalty was not covered under the Quality of Service (QoS) regulations which allow a maximum fine of Rs50,000 for failure to meet service conditions.

The matter will be heard next on 21 December.

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