Vodafone Idea and Bharti Airtel Might Get Some Relief from DoT

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Vodafone Idea (Vi) and Bharti Airtel might be relieved from paying penalties worth Rs 3,050 crore. The Department of Telecommunications (DoT) might reject the Telecom Regulatory Authority of India’s (Trai) recommendation for charging telcos with Rs 3,050 crore for not giving Reliance Jio points of interconnection when it started operating back in 2016. As per a report from the Financial Express, telcos might be saved from paying this penalty given the financial burden they are already in. Both Vi and Airtel have to pay adjusted gross revenue (AGR) dues over the next 10 years and it wouldn’t be fair to add more financial burden on them at this point in time — more on the story ahead.

Government Not Interested in Adding More Legal Tussle With the Vi and Airtel

The next round of 4G spectrum auctions is due in March 2021. Before that, the government doesn’t want to upset any telco by asking them to pay penalties. It would add to the risk of telecom operators dropping from participation in the auctions. Adding to this, the new Trai chairman might let the issue go as well.

For the unaware, the Digital Communications Commission (DCC), the apex decision-making arm of DoT had already approved for the penalties on the telcos, but the telecom minister Ravi Shankar Prasad had not shown any interest. Further, DoT is aware that if the penalties are approved, both Vodafone Idea and Bharti Airtel will challenge the decision in the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) court of India. Getting involved in yet another legal case is not something the government wants to do right now.

What’s worth noting here is that Trai doesn’t have the authority of levying penalties on the operators. The power rests with DoT; what Trai can do is only suggest. The telecom department is not keen on looking for penalties from the operators and it would have been the same if this case was brought to DCC a year back.

Officials have tried talking with Trai to lower the amount given the financial stress the operators are already in, but the regulator hasn’t budged. Adding to this, DoT officials had already met and rejected the recommendation of penalty by Trai and left the final decision to be taken by the DCC. Because as a licensor, it is only DCC which has the power to levy penalty on the operators.

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