TDSAT issues notice to Trai on ADC abolition

TELECOM TANGLE

While issuing the notice, TDSAT Chairman Justice Arun Kumar also directed the regulator to file its reply within four weeks. During the proceedings, counsel appearing for the PSU submitted that the regulator arbitrarily removed the ADC.

He said that despite the low-cost service provided by the telecom giant, Trai rejected it by saying that BSNL would not get a single penny after 2008.

 

"However, when we put documents, then they only realised that BSNL was entitled for Rs 2,000 crore and it should be paid to us. That money should be paid to us to ensure a level playing field," he said.

Opposing the Trai's contention that the loss suffered by the BSNL should be recovered by the government, through USO, BSNL's counsel contended that they need money.

"We need the money... How can you put us on the mercy of a third party (DoT)," submitted BSNL's counsel opposing TRAI suggestion to recover that from the government.

Opposing it, Trai counsel Saket Singh submitted that ADC was a depleting regime and not fixed for ever. "Since 2003, when it was started it was known that it would come to an end," contended Trai's counsel. However, he also submitted that non profit rural operations need to be protected.

On this Tdsat Chairman Justice Kumar said, "you would have to do some thing. Private telecom operators would not go in rural areas just for charity".

BSNL further submitted before the tribunal that for the last 7-8 years it still has more than 98 per cent of the rural connections.

"Although Trai gave rewards of more than Rs 6,000 crores to the private telecom operators but none of them went there," said counsel appearing for BSNL.

However, Trai opposed it by saying that according to their data, private companies are now providing 66 per cent of total connections.

Meanwhile, accepting the request of the state-run BSNL, the tribunal clubbed all the previous three ongoing matters in which the telecom giant had challenged the ADC reduction for the financial year 2006-2007 and 2007-2008.

The tribunal has listed the 2006-2007 and 2007-2008 matter on May 9 for next hearing. Now all appeals would be listed together on July 9 for hearing. In March 2008, TRAI had removed ADC.

As per its road-map the sectoral regulator has decided to abolish the ADC from 2008-09. For the financial year 2007-08, Trai had reduced ADC by 37 per cent to Rs 2,000 crore from Rs 3,200 crore.

Access Deficit Charge is a levy paid by private telecom operators to BSNL for meeting the cost of unprofitable operations in rural areas.