Sibal for Cellular Operators Association in appeal before Supreme Court
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Sibal for Cellular Operators Association in appeal before Supreme Court

Murali Krishnan

The Supreme Court has issued notice to the Central government and Telecom Regulatory Authority of India, among others, in the appeal filed by Cellular Operators Association of India (COAI) against the judgment of the Delhi High Court in the call drops case.

The Court however, did not stay the judgment of the High Court.

The matter was heard by a Division Bench of Justices Kurian Joseph and Rohinton Nariman with Senior Advocate Kapil Sibal appearing for the appellant.

COAI has assailed the Telecom Consumers Protection (Ninth Amendment) Regulations, 2015 which had made it mandatory for telecom operators to compensate subscribers for the first three calls dropped per day at the rate of Rs.1 per dropped call.

The appellant has contended that the regulations are arbitrary and violative of Article 14 and has also challenged the jurisdiction of TRAI to enact the regulations.

In the petition, which has been drawn by advocates Manjul Bajpai and Sashwat Bajpai, settled by Senior Advocate Gopal Jain and filed through advocate EC Agrawala, it has been contended that,

“Impugned Regulation which fastens strict liability on the Petitioners without fault (for no fault) is arbitrary and violative of Article 14 of the Constitution as it compels service providers to do the ‘impossible’, is against the law of physics and grants compensation even for the first call drop.”

COAI has submitted that TRAI itself had, by way of Quality Service Regulations of 2008, prescribed call drop benchmark at 2%, and not 100% faultless coverage. It has, therefore, contended that the current regulations are contrary to the already existing regulations which continue to occupy the field.

COAI has further submitted that TRAI failed to take into account the fact the call drop could be due to a variety of reasons including external factors which the TRAI and High Court have failed to account for.

“That the High Court failed to appreciate that the exact reasons for call drop cannot be identified and are coupled with external contributory factors. Thus, the Regulations are unworkable and un-implementable and are unreasonable. This issue has been left undecided.”

Alleging that the regulations are just a “populist measure”, the appellant has contended that the regulations don’t remedy the issue of call drop but merely deals with the compensation for call drop.

“That the Impugned Regulations is a populist measure and should have been set aside by the High Court following its own judgment dated 30.10.2015 in Writ Petition (C) No. 895 of 201.”

Aside from these grounds, the appellant has also questioned the jurisdiction of TRAI in enacting the impugned regulations. According to COAI, Section 11 (1) (b) (v) of TRAI Act gives TRAI the power to lay down and ensure the standards of quality of service alone and not to levy compensation.

“The TRAI Act does not empower TRAI to levy any penalty or compensation under Section 11 (1) (b) (i) and (v) of the TRAI Act.

…the grant of compensation requires an adjudication to establish a breach and thereafter determine liability. TRAI’s Impugned Regulation is in the nature of a general provision of granting compensation which has pre-judged and pre-determined compensation without an adjudication. 

….. if a power does not exist or is permitted by a Statute, then it cannot be exercised, regardless of quantum of amount involves, whether termed as “notional compensation” or “penalty”. The absence of power will result in the decision being ab-initio invalid. Compensation is neither notional nor the TRAI’s impugned Regulations say so and the Hon’ble High Court has erred is saying so.”

When the case was heard on Friday last week, the court issued notice but refused to grant any interim relief. Interestingly, the court made it clear that TRAI has jurisdiction to levy compensation and the Court will only decide on fixing the responsibility for call drops. The case will now be heard on March 10.

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