Law Ministry says DoT can terminate 3G permits of Bharti, Idea, Vodafone and claim amounts earned by companies for providing these services - Economic Times
The law ministry has said the telecom department can initiate action, including terminating mobile permits of Bharti, Vodafone and Idea, for allegedly violating licence conditions and entering into bilateral roaming agreements in areas where they did not have 3G permits.
Responding to a telecom department (DoT) query, the Additional Solicitor General has said the DoT was 'well within its rights to claim the amounts earned by companies by providing 3G services for which they did not have any authorisation, permission or license from the DoT'.
"It will be based on the doctrine of unjust enrichment' and this would be distinct from the termination of licences, the ASG's July 14 communication to the DoT added.
At the same time, the law ministry has also said the government cannot impose financial penalties on mobile phone companies for entering into 3G roaming agreements.
Armed with the law ministry's endorsement, the DoT will soon ask the three incumbent operators to stop offering 3G services in those circles where they don't have airwaves, according to an internal department communication dated July 30. "The first step should be to stop the services being illegally provided otherwise 'unjust enrichment' will continue," the DoT internal note added.
The DoT had sought the law ministry's opinion last month on whether leading GSM operators - Bharti Airtel, Vodafone and Idea Cellular - can continue to offer third-generation services on a pan-India basis, after a two-member bench of the telecom disputes tribunal had delivered a split verdict on a petition challenging the government's order banning such agreements.
Bharti, Vodafone and Idea had won 3G airwaves in 13, 9 and 11 circles, respectively, in the 2010 auctions and their intra-circle roaming pacts ensured that customers could access high-speed data services on a pan-India basis. India is divided into 22 circles. While incumbent telcos were of the view that the tribunal's split verdict enabled them to continue offering high-end data services even in areas where they did not have 3G permits, the DoT had shared the opinion that the judgement paved the way for it to initiate action against mobile phone companies
Under current rules, the maximum penalty for license violation is 50 crore per circle, and ET had reported last month that the telecom department planned to issue showcuase notices to these companies and added that Bharti, Vodafone and Idea face the prospect of being slapped with penalties to the tune of 500 crore, 450 crore and 550 crore, respectively.
An executive with a mobile phone company said the industry was not aware of the law ministry's opinion, but added that it could add to the regulatory and policy uncertainties confronting the sector. The executive further said that split verdict from the tribunal that heard the case meant 'status quo' until the Supreme Court issues final orders on this issue.
The DoT has also decided to seek clarity from the Additional Solicitor General regarding his opinion that financial penalties of 50 crore per circle cannot be imposed on telcos for the alleged violation. The DoT is of the view that showcause notices for termination of mobile permits and imposition of financial penalties must be slapped simultaneously on telcos.
The law ministry has said the telecom department can initiate action, including terminating mobile permits of Bharti, Vodafone and Idea, for allegedly violating licence conditions and entering into bilateral roaming agreements in areas where they did not have 3G permits.
Responding to a telecom department (DoT) query, the Additional Solicitor General has said the DoT was 'well within its rights to claim the amounts earned by companies by providing 3G services for which they did not have any authorisation, permission or license from the DoT'.
"It will be based on the doctrine of unjust enrichment' and this would be distinct from the termination of licences, the ASG's July 14 communication to the DoT added.
At the same time, the law ministry has also said the government cannot impose financial penalties on mobile phone companies for entering into 3G roaming agreements.
Armed with the law ministry's endorsement, the DoT will soon ask the three incumbent operators to stop offering 3G services in those circles where they don't have airwaves, according to an internal department communication dated July 30. "The first step should be to stop the services being illegally provided otherwise 'unjust enrichment' will continue," the DoT internal note added.
The DoT had sought the law ministry's opinion last month on whether leading GSM operators - Bharti Airtel, Vodafone and Idea Cellular - can continue to offer third-generation services on a pan-India basis, after a two-member bench of the telecom disputes tribunal had delivered a split verdict on a petition challenging the government's order banning such agreements.
Bharti, Vodafone and Idea had won 3G airwaves in 13, 9 and 11 circles, respectively, in the 2010 auctions and their intra-circle roaming pacts ensured that customers could access high-speed data services on a pan-India basis. India is divided into 22 circles. While incumbent telcos were of the view that the tribunal's split verdict enabled them to continue offering high-end data services even in areas where they did not have 3G permits, the DoT had shared the opinion that the judgement paved the way for it to initiate action against mobile phone companies
Under current rules, the maximum penalty for license violation is 50 crore per circle, and ET had reported last month that the telecom department planned to issue showcuase notices to these companies and added that Bharti, Vodafone and Idea face the prospect of being slapped with penalties to the tune of 500 crore, 450 crore and 550 crore, respectively.
An executive with a mobile phone company said the industry was not aware of the law ministry's opinion, but added that it could add to the regulatory and policy uncertainties confronting the sector. The executive further said that split verdict from the tribunal that heard the case meant 'status quo' until the Supreme Court issues final orders on this issue.
The DoT has also decided to seek clarity from the Additional Solicitor General regarding his opinion that financial penalties of 50 crore per circle cannot be imposed on telcos for the alleged violation. The DoT is of the view that showcause notices for termination of mobile permits and imposition of financial penalties must be slapped simultaneously on telcos.
... Sorry if they disturbed ur rant against Airtel... BTW when u say "So wake up and stop just hammer govt on each and single point." , u could replace the word govt with airtel & follow that advice urself... Also when I said justifying tariff increase I clearly meant they would use it to justify their increasing the tariff & not that their increasing the tariff would be justified... Small diff in sentence composition but big diff in the actual meaning... 
... Need Idea 3G for my visits to Punjab (my native state) 
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