Regulator bound by rules, cannot recommend penalty changes in interconnect case: Trai official

The telecom regulator is not in a position to modify its previously recommended penalty on Vodafone India and Idea Cellular (now merged) and Bharti Airtel as it is bound by the provisions of Trai Act, according to a senior Trai official.

Citing the clauses in the Act, the regulator recently informed the Department of Telecom (DoT) that it is "constrained from offering any further comments" on the matter and the Centre now has to take a final call on the issue.

The regulator has already given its views once in response to a back reference in 2017 by DoT, the Trai official said adding that as per the provisions in the Act there is no scope for any further modification.

The Act makes it clear that once a recommendation is referred back to Trai by DoT, the regulator has to within 15 days, forward to the central government its suggestions after considering the reference made by the government.

After receipt of further recommendation, if any, the Centre shall take a final decision, the Act says.

The official, who did not wish to be named, said pursuant to the October 2016 suggestions of Trai on the penalty to be imposed on the three operators, the recommendations were referred back by DoT on April 5, 2017 for reconsideration, to which Trai sent its views to the government on May 24, 2017.

Hence, after receiving "further recommendation" in response to the first back reference, the Centre has to take final decision on the matter, the official said explaining that Trai is unable to change the penalty it had suggested since it is bound by the provisions of the Act.

In October 2016, Trai had recommended imposing a total penalty of Rs 3,050 crore on Airtel, Vodafone Idea for allegedly denying interconnectivity to newcomer RJio.

The penalty on Airtel and Vodafone works out to be about Rs 1,050 crore each. In case of Idea it comes to about Rs 950 crore. Since Vodafone and Idea have now merged their businesses, the new entity Vodafone Idea will have to bear the burden of both companies.

The Digital Communications Commission, the apex decision-making body of DoT, last month, approved imposing penalty on Airtel and Vodafone Idea for not providing points of interconnection to Reliance Jio.

Before imposing the penalty, however, the Commission decided to seek Trai's views on revising Rs 3,050 crore suggested penalty, citing the "present financial health of the sector".