Telecom minister approves Rs 350-cr penalty on Airtel

Penalty on each of seven licences of Bharti Airtel that entered into 3G roaming agreements with other operators to offer services beyond permitted zones

Telecom Minister Kapil Sibal is learnt to have approved the recommendation of a Department of Telecom (DoT) committee to impose a Rs 50-crore penalty each on seven licences of Bharti Airtel for 3G roaming agreements with other operators to offer services beyond the permitted zones.

Sources said the committee held the “breach” of 3G provisions by seven licences of Bharti Airtel did not attract the maximum penalty which is termination, but recommended “imposition of maximum financial penalty permitted under licence conditions i.e Rs 50 crore against each licence”.

The minister approved the recommendation on February 27, the sources said.

Airtel won 3G spectrum in 13 of 22 telecom circles in 2010 through auction and entered into a quid pro quo agreement with other players which won spectrum in other service area.

DoT has held it is illegal to offer third-generation or 3G data services beyond a company’s licensed zone or circle. On December 23, 2011, it had issued a letter instructing various telecom service providers, including Bharti Airtel, to immediately stop providing the intra circle roaming service in all service areas.

The operators, however, had moved the Telecom Disputes Settlement and Appellate Tribunal challenging the DoT order, saying it would harm customers and investment in the sector. In July 2012, the tribunal had delivered a split verdict.

While one member of the two-member bench favoured the DoT’s claim that roaming agreements were illegal, the other supported the operators who had challenged it.

DoT had again issued a notice to Bharti Airtel in September 2012, after which the company approached Delhi High Court against the notice and the matter is still sub judice. No comments could be elicited from Bharti Airtel.