Telecom firms face Rs 400 cr fine for delayed services

The Telecom Commission is considering imposing fines of Rs 400 crore on seven telecom service providers for delay in commissioning of services. A note for this purpose was put up for consideration last month.

A fine of Rs 147 crore is proposed on Reliance Infocomm, of Rs 126 crore on Tata Teleservices, Rs 49 crore on Dishnet Wireless (now owned by Maxis), and of Rs 42 crore on Bharti Airtel Ltd.

In addition, fines may be imposed on Hutchison Essar South Ltd (Rs 8.15 crore), Shyam Telelink and HFCL Infotel Ltd (Rs 7 crore each). 
 

IN THE NET
Reliance Infocomm	147
Tata Teleservices	126
Dishnet Wireless	49
Bharti Airtel	42
Hutchison Essar South Ltd	8.15
Shyam Telelink	7
HFCL Infotel Ltd	7
(Proposed fines in Rs cr)

According to sources, the matter was put up for Telecom Commission's consideration in December last year. This followed the issue of show-cause notices to these operators early last year. When contacted, representatives of some of the companies said the penalty would be contested.

The decision to impose fines (liquidated damages in DoT parlance) was first taken by the then DoT secretary on January 13, 2006. The file was submitted for clearance by Communications Minister Dayanidhi Maran, who asked the secretary to look into the matter.

Accordingly, the matter was put up for re-examination. Subsequently, a file proposing fines was put up for consideration of the Telecom Commission. The quantum of damages was revised over a fortnight ago.

DoT sources said the operators had migrated to a Unified Access Service licence from the earlier Basic Services licence, but did not provide the relevant documentation detailing the roll-out within the stipulated one year period.

In fact, Hutchison Essar South Ltd produced the roll-out obligation certificate in July 2006 (18 weeks after the one-year deadline) for the West Bengal service area.