Rs 2179.41cr penalty imposed on telcos for violating CAF rules

A total penalty of Rs 2,179.41 crore was imposed on telecom operators till September 30, 2014, for violation of customer verification guidelines, the government said today.
In a written reply to the Lok Sabha, Communications and IT Minister Ravi Shankar Prasad said, "A total penalty of about Rs 2,179.41 crore has been imposed since the inception till September 30, 2014 on telecom operators for violations of verification guidelines."
The minister said the Department of Telecommunications (DoT) issued latest instructions on August 9, 2012, on subscriber verification.
The maximum penalty has been imposed on Aircel at Rs 486.48 crore followed by Reliance Communications at Rs 454.62 crore. State-run BSNL was imposed a fine of Rs 329.14 crore, Bharti Airtel at Rs 309.87 crore, Vodafone at Rs 211.85 crore and Idea Cellular at Rs 123.44 crore for violation of norms, according to the reply.

A penalty of Rs 172.80 crore was imposed on Tata Teleservices, Rs 52.31 crore on Sistema Shyam Teleservices, Rs 11.65 crore on Uninor, Rs 11.17 crore on MTNL and Rs 10.92 crore on STel.
Prasad said the verification of identity of mobile phone users is mandatory and the DoT has been issuing instructions from time to time for the same.

"These instructions contain procedures for verification of identity of mobile subscribers which stipulate that mobile connection should be issued on the basis of documents as proof of identity and proof of address," he said.
The list of documents include passport, driving licence, election commission ID card, arms licence, PAN card and Aadhaar card among others.

Prasad said the Department has found from the audit of customer application forms (CAF) that only about 4 per cent of CAF were non-compliant to the subscriber verification guidelines during 2013-14.
The reasons for non-compliance include missing CAFs, missing photo/proof of identity/proof of address on CAF, subscriber's acquisition based on apparently forged documents, pre-activated mobile connections and bulk connections issued to an individual or a company or an organisation.
"By invoking licence conditions, the government has prescribed penalties to be imposed on telecom service providers who, during audit, are found non-compliant to the licence conditions and instructions issued by the government on the subject of CAF verification," the Minister said.

The amount of financial penalty is calculated on the principles as followed in the income tax system i.E calculating the financial penalty separately by applying the corresponding slab rate and then arriving at total amount of penalty.