After year-long dispute, the Supreme Court of India has finally directed Tata Teleservices' 'Walky' and Reliance Communication's cordless phone to pay Access Deficit Charges (ADC) to Bharat Sanchar Nigam Limited as per limited mobile phone service.
The Apex court on Wednesday sustained the decision of Telecom Disputes Settlement and Appellate Tribunal (TDSAT) which had argued that ‘Tata Walky’, the wireless local loop fixed line service and Reliance Communications’ (earlier known as Reliance Infocom) ‘Unlimited Cordless’ were not fixed line phone but very similar to limited mobile phones. Thus, both the company were liable to pay Access Deficit Charges (ADC) of worth Rs. 700-crore to BSNL for interconnection services.
Upholding the decision of TDSAT, a bench of Justice H S Kapadia and Justice B Sudarshan Reddy on April 30 dismissed the plea of Tata Teleservices and Reliance Communications by classifying the companies’ fixed wireless phone service as limited mobile. As per court’s direction Tata Teleservices will have to pay Rs.300-crore while RCom a sum of Rs.400-crore to BSNL as ADC charges.
‘If it was free service, the private telecom company is liable to pay ADC charges to BSNL, which BSNL used for rolling out telecom network in the rural areas that was nearby 10-lakhs line in 2003,’ as SC cited to describe the need of ADC.
Earlier, both the telecom players had appealed against the decision of TDSAT before the apex court by arguing that since limited mobile phones were being provided under the fixed line telephone licence, they were not liable to pay the charges to BSNL.
As per Telecom Regulatory Authority of India (TRAI) rule, private telecom operators were liable to pay ADC on their mobile phone services to offset the deficit suffered by BSNL, which was tasked with providing below-cost telecom services in rural and remote areas.
However on court’s decision, officials of both telecom services have responded not to comment until they receive the order from court and a detailed study of the same.
On the other hand, BSNL has said, ‘the sum could go even higher’ if we (BSNL) calculate the arrears regarding international calls between the two private players.
TRAI has now scraped ADC from April 1, but till March 31, 2008, it was mandatory for the private telecom companies to share a definite percentage of their revenues from mobile services with BSNL as ADC, which is used to expand the telephone network in less then telecom cost in rural and remote areas for public and for companies to run the communication smoothly.
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