The Division Bench of the Delhi High Court in the case of Vodafone Mobile Services Ltd. & Anr vs Telecom Regulatory Authority of India consisting of Chief Justice Satish Chandra Sharma and Justice Subramonium Prasad, while upholding the penalty on Vodafone, held that when there is a specialised Tribunal, the Telecom Disputes Settlement and Appellate Tribunal, constituted to deal with the disputes under the TRAI Act, then Courts must be slow to interfere under Article 226 of the Constitution of India.
Facts:
The main issue in these petitions was the recommendation made by the Telecom Regulatory Authority of India (“Respondent No.1”) on October 21, 2016. The recommendation suggested imposing a fine of 50 crores per Licensed Service Area (LSA) for all 21 LSAs, except for Jammu and Kashmir, where POI congestion exceeded the allowable limit of 0.5% as reported by Vodafone. The petitioners argued that this recommendation was illegal and should be invalidated.
The petitioners are telecom service providers with a mobile network across India and in Mumbai. Petitioner No. 1 has a license granted by the Department of Telecommunication (DOT) and Petitioner No. 2 is a shareholder of Petitioner No. 1. They entered into an interconnection agreement with Reliance Jio Infocom Limited (RJIL) for exchanging telecommunications traffic. RJIL requested the petitioners to increase the point of interconnection (POI) to ensure quality and sufficient interconnection capacity for inter-operator traffic. The Telecom Regulatory Authority of India (TRAI) intervened and asked the petitioners to respond to RJIL's request. RJIL raised the issue again in a subsequent letter.
Procedural History:
The petitioners wrote a letter to Respondent No.1/TRAI stating that RJIL’s request for more POI for 'test users' before commercial launch was against their interconnection agreement. A meeting was held where it was concluded that service providers should follow the QOS regulations. The petitioners wrote another letter to Respondent No.1/TRAI about difficulties caused by RJIL’s free calls for ‘test users’ leading to network congestion. A Show Cause Notice was issued to the petitioners for violating TRAI regulations and Unified Service licenses. The petitioners responded but Respondent No.1/TRAI issued a direction to comply with regulations. The Impugned Recommendation was then issued, stating that the petitioners were at fault for not providing POIs to RJIL, and recommending a penalty for POI congestion exceeding 0.5%. The petitioners requested for the recommendation to be withdrawn but it was not, so they filed these petitions before the Court.
Contentions Made:
Petitioner: It was contended that the recommendation made by respondent No. 1/TRAI is wrong and they do not have the authority to recommend a penalty under Section 11(1)(a)(ii) of the TRAI Act. The power to impose a penalty lies solely with the DOT under Clause 10.1(i) of the License Agreement. While TRAI can impose a financial disincentive under QOS Regulations, it cannot exceed Rs. 1 lakh and must follow the Principles of Natural Justice. Reliance was placed on Manipal University & Anr. v. Union of India to contend that the TRAI Act does not give the power to impose or recommend a penalty, and TRAI has no jurisdiction to penalize. The recommendation in question cannot be contested because it is not an order, but a suggestion. The TRAI Act requires transparency in making recommendations, which includes giving the opportunity for representation and a hearing, but this was not provided to the petitioner. The Show Cause Notice also did not mention the possibility of a penalty, which violates natural justice. Finally, the TRAI Act does not give Respondent No. 1 the power to adjudicate, as held in BSNL v. Telecom Regulatory Authority of India.
Respondent: It was contended that the petitions filed were premature and cannot be maintained since no action has been taken by the DOT yet. If the DOT's decision causes harm to the petitioner, it can be challenged later. Two ongoing petitions regarding the same issue are already being heard by the Telecom Disputes Settlement and Appellate Tribunal (TDSAT), so the court cannot entertain these petitions. The TRAI was not performing a quasi-judicial function and hence, an oral hearing was not mandatory. The petitioners had given a detailed reply to the Show Cause Notice before the recommendation was made. The order dated 29.09.2021 had been passed after hearing both the parties fairly and no harm was caused to the petitioners. Any judgment passed by the court will impact the issue pending before the Tribunal. The TRAI had complete authority to make the recommendation as per the license conditions.
Observations of the Court:
The main issue addressed in these petitions was the authority of the TRAI to suggest penalties under the TRAI Act. The Bench examined Section 11 of the TRAI Act which was relevant for adjudication of these petitions.
Relying on Union of India v. Assn. of Unified Telecom Service Providers of India, the Bench concurred with the contention of the Respondent that the first proviso of Section 11(1) states that the Central Government is not obligated to follow the recommendations of certain authorities listed in Clause (a) of Sub Section (1). The Government reviews recommendations and only sends them back for reconsideration if they cannot be accepted or need to be modified.
Relying on Cellular Operators Assn. of India v. Union of India, it opined that the Tribunal’s jurisdiction under Section 14 cannot be considered as supervisory, as it is the only forum for resolving grievances and the appellate jurisdiction is limited to substantial questions of law, civil court jurisdiction is also excluded. The Tribunal has the power to settle any dispute, but it must consider the recommendations of TRAI. Moreover, as per M/s South India Bank Ltd. & Ors. v. Naveen Mathew Philip & ANR. ETC., if a specific Tribunal has been established to handle disputes related to the TRAI Act, courts should refrain from intervening too quickly under Article 226 of the Indian Constitution.
Judgment:
The Bench held that Respondent No. 2 issued an order imposing a penalty on the petitioners for violating license agreements and quality of service regulations for telephone services. Moreover, as per the Supreme Court, courts should not interfere in the decisions of expert tribunals established under the law to resolve disputes. Therefore, the writ petitions were dismissed without any judgment on the merits of the case. The tribunal was open to consider the recommendation challenged by the petitions.
Case: Vodafone Mobile Services Ltd. & Anr vs Telecom Regulatory Authority of India
Citation: W.P.(C) 685/2017 & W.P.(C) 11740/2016
Bench: Chief Justice Satish Chandra Sharma, Hon’ble Mr. Justice Subramonium Prasad
For Petitioner: Mr. Gopal Jain, Senior Advocate with Mr. Manjul Bajpai, Mr. Manu Krishnan, Mr. Vipul Singh, Ms. Madhavi Agarwal, Adv.
For Respondents: Mr. Ramji Srinivasan, Senior Advocate and Mr. Ritin Rai, Senior Advocate with Mr. K R Sasiprabhu, Mr. Aabhas Kshetrapal, Mr. Aditya Swarup, Mr. Tushar Bhardwaj, Mr. Vishnu Sharma, Mr. Manan Shishodia, Mr. Prakhar Agarwal, Advocates Mr. Manish Mohan, CGSC with Mr. Jatin Teotia, Advocate for UOI Ms. Arunima Dwivedi, CGSC with Ms. Pinky Pawar, Mr. Aakash Pathak, Advocates for UOI.
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