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Published : June 17, 2014 | Author : shreya.mazumdar
Category : Cyber Law | Total Views : 8635 | Rating :

4th year LL.B. from Christ University, Bangalore Email: shreya.mazumdar@legalserviceindia.com

Telecommunication laws in India and its drawbacks

The telecom sector in India is more than one hundred and sixty five years old and until 1950 postal means were the only way of communication in India . It was in the year 1950 that electric telegraph started for first time in India between Calcutta (Kolkata) and Diamond Harbor (suburbs of Kolkata) and it was in the year 1851 it was open for the use of the British East India Company and subsequently the electric telegraph wires were established throughout India. In the year 1854 a separate department was open for public . With the passage of time in 1883 telephonic services merged with the postal systems. The Indian Telegraph Act, 1885 is one of the oldest Legislations still in effect in India and the Act to amend the law relating to telegraphs in India . In the later years after the independence all foreign telecommunication companies were nationalized to form the Posts, Telephone and Telegraph (PTT). PTT was a government body governed by the Ministry of Communication . Till 1984 the Indian telecom sector was entirely under the ownership of the government when the private sector was only used for the manufacturing. In order to make a concrete effort towards the development of research and development in the telecom sector the government set up an autonomous body- Centre for Development of Telematics (C- DOT) . It was in the year 1984 C-DOT was set up for the development of the state of the art telecommunication technology to meet the growing need of the Indian telecommunication network . The entire evolution of the telecom sector started only after the government separated the postal and the telephonic services by setting up the Department of Posts and Department of Telecommunication (DoT) . The Indian Wireless Telegraph Act, 1933 was enacted the possession of wireless telegraphy apparatus and the possession of wireless telegraphy apparatus by person can only be allowed in accordance with a license issued by the telecom authority and it also levied penalties if any wireless telegraphy apparatus is held without a valid license.

1990s was an era of opening up of government for private investment for telecom sector by the government. The Telecom Regulatory Authority of India (TRAI) was setup in 1995 and this reduced the interference of the government in deciding tariffs and policy making . The highlighting change that took place was that the Government of India corporatized the operational wing of DoT in the year 2000 and renamed it Department of Telecom as Bharat Sanchar Nigam Limited (BSNL) . In last 10 years many private operator’s especially foreign investors successfully entered the high potential Indian telecom market .

TRAI Act 1997
The Telecom Regulatory Authority of India Act was enacted in 1997 whose Chairperson was to be a sitting or retired Judge of the Supreme Court or a Chief Justice of a High Court and the members were the person having special knowledge of and personal experience in telecommunication, industry, finance, accountancy, law, management and consumer affairs . There was a need that was felt for the regulatory body after the entry of the private sector . TRAI was first established in the year 1997 in pursuance of an TRAI (Ordinance) 1997 which was later replaced by an Act.

The main point of establishment of TRAI was that it has some major recommendatory, regulatory and tariff setting functions of TRAI which is to make recommendations on the need and timing for an introduction of the new service provider on the terms and conditions of license to a service provider .TRAI is also empowered to adjudicate the matters between the service providers or among the service providers and a group Consumer on the matters relating to the technical compatibility and interconnection between the service provider and quality of telecommunication services and interest of the consumers and ensures effective compliance of Universal Service Obligation, notify the rates at which telecommunication services within India and outside shall be provided . TRAI has a license to provide power to issue directions to the Service Provider and it is guided by the principle of natural justice and appeals from the decisions of TRAI lay to the High Court.

In exercise of power conferred by proviso (k) to sub- section of Section 2 of the TRAI Act, the Central Government under Notification No. SO 44(E) dated 9th January, 2004, had notified broadcasting and cable services to be telecommunication services. The TRAI (Amendment) Act, 2000 led to the reconstituting of the authority.

TDSAT, Telecom Dispute Settlement and Appellate Tribunal which was an Appellate Tribunal established by the Central Government in May 2000 was to adjudicate between a licensor and a licensee between two or more service providers or service providers and group of consumers and to hear and dispose of appeal against any direction, decision or order of the Telecom Regulatory Authority of India and thus the Tribunal exercised both original and appellate jurisdiction.

Largely Appellate Tribunal involved the cases related to interconnection which challenged the basis of computation of license fee by the licensor, wrongful levy and charges of royalty and license fee for frequency allocation, blocking of calls by one group or service providers, dispute relating to default traffic, challenges to tariff fixed by TRAI etc .

Tussles between TRAI and DoT
TRAI enthusiastically sided for its regulatory jurisdiction and fought for a seat at the decision making table in all important policies and regulatory matter . TRAI’s first chairperson was Justice SS Sodhi and his authority was resolute, engaging and insisting in promoting an autonomous regulatory agenda . Giving an affirmation to its statutory jurisdiction TRAI told DoT that it should be consulted before the government took any major regulatory or licensing decision. DoT ignored the request and proceeded with making certain decision which was certain key policy and licensing decision as it was stated that it was not used to taking orders from other agencies and thus they took decisions without consulting the Authority.

The consequence of DoT not going with the request made by TRAI was to that effect that the decision of DoT was challenged by the effected parties before TRAI by invoking the Authority’s statutory dispute-resolution jurisdiction. DoT’s contention was that the decision was illegal because they were made without mandatory prior consultation with TRAI . In addition to that various preliminary objections regarding TRAI’s competence to entertain the case was put in question. TRAI did not focus on the questions laid down by DoT which was ignored by the preliminary objective and proceeded to hear the cases on merits . In the case of Aircel Digilink v. Union of India TRAI ruled that DoT must provide private cellular licensees with greater interconnection access to the Department’s fixed networks . This decision added fuel to the fire and DoT was outraged by the decision and it marked the beginning of an antagonistic relation between DoT and TRAI . Further the Authority restrained DoT from encashing bank guarantee of cellular licensees that had not paid their license fees and in addition to that the Authority reversed DoT’s orders that unilaterally raised fixed to cellular tariffs in non metropolitan areas .
The Delhi High Court’s decision in MTNL-I substantially curbed TRAI’s regulatory authority and Microwave Communication placed a huge question over TRAI’s role as an effective independent regulator of telecom service . The entry of 2000 Amendment was to straighten the mess that questioned TRAI’s credibility and independent regulatory competence which was to clarify the extent of TRAI’s statutory power and strengthening the Authority’s reputation as an independent regulator . It was the creation of TDSAT which was a remedial achievement of the 2000 Amendment . The amendment refrained from making any changes to the prevailing licensing framework which was a bone to pick between DoT and TRAI . Although the amendment ensured that the government would have to seek TRAI’s recommendation in certain licensing matters but it did nothing to dilute the government’s power to issue, modify and revoke licenses.

Government Control Over TRAI
There are three ways in which the government exercises control over TRAI that is; firstly, section 25 enables the Central Government to issue binding directions to TRAI from time to time . Secondly, the Authority’s funding is largely derived through grants made available to the government. Thirdly the government can make rules under Section 35 of the TRAI Act on a wide variety of subjects and these rules are binding on the Authority .
Section 25 of the Act authorizes the Central Government to issue directions to TRAI for the following :
1. India’s sovereignty and integrity;
2. State security;
3. Friendly relation with foreign states
4. Public order;
5. Decency; and
6. Morality.

Section 25(2) states that the government matters are binding on TRAI with respect to policy matters . Section 25(3) that it is on the Central Government to decide whether a question is a policy one . This provision gives the Central Government the final say on all policy decision. TRAI must be given an opportunity to express its view before a direction is issued .
Section 25 is considered to be the “birth defect” in the TRAI Act as it does not fulfill the underlying legislative intent to establish an independent regulator for telecom sector . It had been suggested to the government that Section 25 hardly enabled the government to convey its policy vision to TRAI . Though this did not explain the reason as to why the government’s position on policy question must prevail over the independent regulator’s opinion in all cases.

Relationship With TDSAT
TRAI enjoyed both regulatory and adjudicatory power and it had original jurisdiction to adjudicate dispute among service providers and dispute between service providers and consumers. After the birth of TDSAT’s creation in 2000, TRAI lost its dispute- resolution jurisdiction. Thus now in order to resolve a dispute arising in the telecom sector the Authority is required to defer to the Tribunal. It was before the 2000 amendment that the TDSAT’s original jurisdiction to hear and decide dispute is much broader and serene than TRAI’s adjudicatory body. With this the Tribunal also has the appellate competence to review TRAI’s direction, decision and orders. In the case of BSNL v. TRAI it was held that since the 2000 Amendment took stripped TRAI of its dispute resolution powers the Authority cannot require service providers to seek its intervention if dispute arises among them. The jurisdiction to hear dispute and appeal now vests exclusively with TDSAT as the ‘sole judicial authority’ in the communication sector.

The Tribunal’s appellate jurisdiction over the Authority is founded in Section 14(b) of the TRAI Act and that provision gives TDSAT the ability to hear and dispose of appeal against any TRAI directions, decision, or order made under the statute. The decisions given by TRAI which is appealable to TDSAT, cannot be audited by the Comptroller and Auditor General of India though TDSAT cannot compel TRAI to enact a particular regulation or a direction.

1. The main focus of the General Assembly in the development in the field of information and telecommunications is mostly relating to the situation and the context of international security . The international law on the telecommunication sector mostly deals with the sphere of information security and possible cooperation measures to address them . It also includes the concept aimed at strengthening the security of global information and telecommunication systems . In comparing the laws to an Indian telecommunication perspective, the telecommunication law does not exclusively deal with something like telecommunication in the context of national security. But there are other laws like the Information Technology Act which deals with the concept of cyber space.

The reason to focus on Information and communication technologies (ICTs) because of the complex interconnectivity of telecommunication and the Internet and any ICT device can be the source or target of increasingly sophisticated misuse . The growing use of ICTs in critical infrastructure creates new vulnerabilities and opportunities for disruption in the growing field of mobile communication devices and web run services.

There are various factors which fuel the growth of telecom sector which includes increased access to services owing to launch of technologies like 3G and BWD, better devices, changing consumer behavior and the emergence of cloud technologies and majority of investment goes into the capital expenditure for setting up newer networks like 3G and developing the transmission . Though Indian telecom is fast growing and every aspect is becoming more global but the telecom laws are in India follows a different line as compared to the International Laws. Challenge is the need to expand tele-density and a preparation for introduction of new technology and services . Authorities must devise protocols for third and fourth generation networks and as well as establish and implement a sound, transparent spectrum policy, which is the need for the hour.

2. The independence of TRAI has often been challenged, and the reason is the political barriers to such independence are quite evident from a study of the sector’s regulatory history as a relation between the government and the TRAI have been characterized by rough ride.

Regulators also need to be transparent and accountable to customers and the focus of a regulator is to defend and promote consumer’s choice, welfare and quality of service . TRAI had made an effort to gather participation by regularly consulting consumer group among other things but consumer participation is lacking as mostly service providers attend these meeting and very few consumer group participate actively . TRAI is not authorized to impose penalties and thus all directives are not followed by the operators . Since there is insufficient spectrum to meet the requirements of the existing operators which is a question mark for the new applicants, an efficient, fair approach is manifested in the interest of the telecom industry . The sector is mostly seen as a region of growing complexity in the network by the segmentation of market into fringe areas and niches that cater to different group of customers and heightened role of technological innovation in driving change .

The Telecom sector still has to focus on the infrastructure facility and it may follow the International principle of global development as the 3G and 4G is the need of the hour. Therefore there has to be a sound, spectrum policy which is needed to control. With the increasing complexity of interconnection between the telecom and internet the information and communication technologies can be a source of sophisticated misuse which also has to be taken care of.

The next focus is on TRAI which has been the area stuck in the cobwebs of political barriers. There is a need that the regulators are supposed to be transparent and accountable to customers and the focus of the regulator is to defend, promote consumer’s choice and quality. There is still an insufficiency in the spectrum for the existing operators. There is still a region of complexity in the segment of market for the network.
[10] Id.
[11] Supra Note 1.
[12] Manjul Bajpai, Telecom Law and Telecom Dispute Settlement Mechanism in India- A Bird’s Eye View(November,11, 2011) http://www.tdsat.nic.in/New Compendium19.11.2008/roman_V_1/Manjul_1-36.pdf
[13] Id.
[14] Telecom Regulatory Authority of India(TRAI) Act1997, http://www.dot.gov.in/act-rules/telecom-regulatory-authority-indiatrai-act-1997(last visited on 30 Feb, 2014)
[15] Id.
[16] Supra note 12
[17] Supra note 13.
[18] Supra note 12.
[19] Supra note 13.
[20] Supra note 13
[21] Id.
[22] RAGHAVAN VIKRAM, COMMUNICATION LAW IN INDIA 174(Lexis Nexis Butterworths, 1st ed. 2007).
[23] Id.
[24] Id.
[25] Id.
[26] Id.
[27] Id.
[28] Id.
[29] Id.
[30] Id. note at 182.
[31] Id.
[32] Id.
[33] Id.
[34] Id. note 183.
[35] Supra note 22 at 189.
[36] Id.
[37] Id.
[38] Id.
[39] Id.
[40] Id.
[41] Id.
[42] Id.
[43] Id.
[44] Id. at 190.
[45] Development in the field of Information and telecommunications in the field of International Security, (Dec, 2011), www.un.org/disarmament/topics/informationsecurity
[46] Id.
[47] Id.
[48] Id.
[49] Id.
[50]Supra note 3
[51] R.U.S. Prasad, The Impact of Policy and Regulatory Decision on Telecom Growth in India(July,2008), http://www.stanford.edu/group/siepr/cgibin/siepr/?q=system/files/shared/pubs/papers/pdf/SCID361.pdf
[52] Id.
[53] Vijay Vir Singh, Regulatory Management and Reform in India: Background paper for OECD, (2008), http://www.oecd.org/gov/regulatory-policy/44925979.pdf
[54] Id.
[55] Id.
[56] Id.
[57] Supra note 24
[58] Id.

The  author can be reached at: shreya.mazumdar@legalserviceindia.com

Writing award This article has been Awarded Certificate of Excellence for Original Legal Research work by our Penal of Judges

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