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TMCNet:  Legal battles rob govt of over Rs 10,000 cr of telecom penalties [India Business] [Times of India]

[August 07, 2014]

Legal battles rob govt of over Rs 10,000 cr of telecom penalties [India Business] [Times of India]

(Times of India Via Acquire Media NewsEdge) NEW DELHI: The government has been able to realize only 4%, or around Rs 450 crore, of the over Rs 10,700 crore penalties it has slapped on various telecom operators since 2011-12. The penalties, which have been slapped for several violations, linked to licensing, radiation and roaming, have been ordered on almost all the major operators that include Bharti Airtel, Vodafone, Idea, Reliance, Tata and Sistema Shyam. PSUs BSNL and MTNL also faced penalties from the Department of Telecom (DoT).


However, with most companies approaching the courts against the penalties, the realization has been poor. "The difference in amount of penalty imposed and realized is primarily due to judicial interventions," communications and IT minister Ravi Shankar Prasad, who is also minister in-charge of the law ministry, told Lok Sabha.

In 2011-12, the total penalties were Rs 1,133 crore, while the realized amount was Rs 206 crore. In 2012-13 the penalties were Rs 719 crore, while the realized amount was Rs 108 crore, while in 2013-14, the total penalties were Rs 7,923 crore, the realized amount was only Rs 128 crore. In the current financial year, Rs 946 crore penalties have been imposed so far, while the realization is Rs 4 crore.

Most of the operators say that the DoT has been "unnecessarily strict" on them and goes for imposing maximum penalty even for procedural lapses and minor offences. The operators had received support in their argument when former telecom minister Kapil Sibal termed the penalties as "excessive" and telecom regulator Trai's head Rahul Khullar called them "absurd".

The DoT is now working on a graded penalty system, which would entail having lower penalties for minor lapses and stiffer ones for offences, which are anti-competitive or against the interest of mobile subscribers. Prasad said that the graded penalty structure will come into force soon.

Mobile lobby groups like Cellular Operators Association of India (for GSM players) and Association of Unified Telecom Service Providers of India (CDMA lobby) have been raising the matter with the government, seeking a more "practical" regime, which is mindful of the nature of offence. "The new penalty structure will lead to creation of different categories for various types of offences. The idea is to have different levels of penalties to make sure that the maximum penalty is not levied in all the cases but only for major offences," a senior DoT official said.

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