Delhi HC refuses to grant relief to Vodafone in Rs 1,050 crore TRAI penalty case

The telecom company had challenged the Telecom Regulatory Authority of India (TRAI)'s recommendation for imposition of the penalty for failing to fulfil an Interconnection Agreement with Reliance Jio Infocom Ltd.

Vodafone had entered into an agreement to provide interconnectivity service to Reliance Jio.

Vodafone had already challenged the Central Government's order dated September 29, 2021, which imposed a penalty of Rs 950 Crores on Vodafone Idea, and TRAI's recommendation of October 21, 2016, before the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) stayed the two orders.

The division bench headed by Chief Justice Satish Chandra Sharma, after noting the above fact refused to interfere with the recommendations and observed that TDSAT is empowered to deal with all disputes arising out of the TRAI Act.

The bench observed, "The TDSAT has been empowered to deal with all disputes arising under the TRAI Act. After the Tribunal gives the conclusionthat the Order dated 29.09.2021 passed by the Respondent No.2 is not sustainable in law, then automatically the recommendation dated 21.10.2016 which is under challenge in the instant writ petitions would be set aside."

"In view of the pronouncements of the Apex Court, the Tribunals which are expert bodies and constituted under the statute to decide the disputes arising under that statute, then Courts must not interfere with Article 226 of the Constitution of India, the bench said while refusing to interfere with the recommendations.

The bench also made it clear that it is always open for the Tribunal to decide the issue on merits, including the recommendation dated 21.10.2016 which is underthe challenge in the instant petitions.

On 21.10.2016, TRAI made a recommendation for penal action of Rs 50 crores per Licensed Service Area (LSA) for all 21 LSAs on Vodafone.

On 14.06.2014, Reliance Jio Infocom Limited (RJIL) entered into an Interconnection Agreement with the petitioners, for the purpose of interconnecting their networks and exchanging telecommunications traffic.

After two years on 14.07.2016, RJIL sent a letter to TRAI to instruct service providers including the petitioners to augment/increase point of interconnection (POI) as RJIL was conducting test trials of its network services before its full-fledged commercial launch.

As per RJIL, increasing/augmenting the POI was required to provide immaculate quality and sufficient interconnection capacity for inter-operator traffic at the POI,in accordance with TRAI regulations.

The TRAI wrote a letter dated 19.07.2016 to petitioners and other service providers seeking a response to RJIL's request for intervention by TRAI as Petitioners and other service providers have been denying/delaying RJIL's request for augmentation of POI. This issue was raised again by RJIL through its letter dated 12.08.2016.

The Petitioners responded with a letter to the TRAI stating that RJIL's request for augmentation of POI for its 'test users', even before its commercial launch, is incongruous with the spirit of the interconnection agreement dated 14.06.2014, which was signed between the petitioners and RJIL, the court noted in the judgement passed on May 24.

On 27.09.2016, a Show Cause Notice was issued by the TRAI to the Petitioners for violation of TRAI regulations and Unified Service licenses as the percentage of failed call attempts during busy hours with RJIL was extremely high, leading to the petitioners failing to meet the benchmark of 0.5 per cent for POI congestion prescribed in QOS regulations.

On 07.10.2016, the Petitioners responded to the Show Cause Notice. However, TRAI issued a direction on the same day under Section 13 of the TRAI Act to all service providers to comply with the TRAI regulations, and Unified Service licenses and furnish a compliance report by 31.10.2016.

The petitioners afterwards replied to TRAI providing information on traffic and congestion on POI.

On 21.10.2016, TRAI issued the recommendation stating that the petitioners were at fault for not providing POIs to RJIL and recommended the imposition of a penalty of Rs. 50 crores per circle for 21 Licensed Service Areas where POI congestion exceeded the allowable limit of 0.5 per cent.

The petitioners requested the TRAI to withdraw the impugned recommendation, but to no avail, the bench noted in the judgement. (ANI)