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HC quashes CPP regime -- TRAI directed to devise alternative scheme

Our Bureau

NEW DELHI, Jan. 18

THE Delhi High Court on Tuesday quashed the Telecom Regulatory Authority of India's proposed inter-connection charges for cellular mobile service providers and the proposed calling party pays (CPP) regime, in which incoming calls to mobiles were to be ma de free.

The court also directed the regulator to devise an alternative scheme to replace the CPP regime, after consultations with all service providers including the state-owned Mahanagar Telephone Nigam Ltd (MTNL) and the Department of Telecom Services (DTS). T RAI's adjudicatory powers on a dispute between service providers can be invoked only when the parties fail to arrive at an accord, a Division Bench comprising the Chief Justice, Mr. S.N. Variava, and Mr. Justice S.K. Mahajan observed.

The defendant has the option of moving the Supreme Court and a decision on it will be taken after further legal consultations, a TRAI official said. It may be recalled that when TRAI moved the Supreme Court, subsequent to the High Court granting interim stay on the CPP regime, proposed for implementation from November 1, 1999, the apex court had asked it to await the High Court judgment on the case.

Today's High Court order relates to petitions filed by MTNL and the DTS. The court fixed further hearing on other related reliefs in connection with the May 1999 Revenue Sharing Regulation sought by a non-Governmental organisation, Telecom Watchdog.

In what could have a bearing on the role of the regulator, as is being assessed by the Government and is expected to be finalised by February, the bench observed that TRAI had no power to make regulations on inter-connection charges.

``TRAI cannot lay down the terms and conditions to service providers on introduction of telecom service, installation of equipment, technology and regulate in respect of the telecom industry,'' the bench ruled. It said that the regulator's powers in this regard were only ``recommendatory'' and the Government was not bound to abide by the proposals.

While stating that TRAI had ``specific powers vested by the legislator" under Section 11 (2) of the TRAI Act'' to notify rates for telecom service in the country, the court pointed out that ``this power was not restricted to only the service provider, bu t was also to be exercised by the Central Government''.

In connection with revenue sharing with MTNL and DoT, the court observed that ever since cellular services were introduced in 1994, it has been a smooth run for the industry. Hence, it felt, there was no substance in TRAI's argument that effective operat ion of cellular service was not possible without the sharing of revenue by DoT and MTNL with other (private) operators.

Citing that ``it is settled law that what cannot be done directly, cannot also be done indirectly'', the bench said that the telecom regulator had tried to assume regulatory powers in respect of the inter-connection charges ``indirectly'' though there wa s no such provision in the TRAI Act.

If the regulation was accepted, there will be a certain clash between TRAI's recommendatory and regulatory powers, and its ``recommendatory powers will be converted into directive powers'', the court said.