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SC Quashes TRAI’s Order To Compensate For Call Drops; Terms it ‘Unconstitutional’

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Mobile Wireline call tariffs-001

In a major relief to telecom operators, and a disappointment for consumers, Supreme Court has quashed TRAI’s earlier order regarding call drop compensation. Hence, telecom operators cannot be forced to compensate for call drops now.

Supreme Court, while striking down TRAI’s diktat on call drops, said that this order was “arbitrary, unreasonable & non-transparent”.

Earlier, TRAI had said that telecom companies are earning Rs 250 cr/day, but they are unwilling to invest in infrastructure or compensate for call drops. On the other hand, telecom firms had said that compensating for call drops will incur them additional expenditure of Rs 54,000 crore, and had even threatened to increase their tariffs.

Kapil Sibal, who represented telecom firms said, “SC has rendered historic judgment today by striking down the TRAI’s regulation,”

Kapil Sibal also added, “SC said the regulation was unreasonable, arbitrary and the procedure followed was not transparent. Government and ministers should not try to be populist and do it in accordance with laws, not outside..”

Last October, TRAI had ordered all telecom firms to pay Re 1 for every call drop, with three as maximum limit for each subscriber. Delhi High Court had supported this order, and contesting this judgment, telecom firms had approached Supreme Court in March this year.

In the petition, telecom firms had argued that TRAI’s order is “arbitrary and whimsical”, and said that ordering compensation for call drops can be only done by an order, and not by any regulation.

If the TRAI order was implemented, some analysts predicted that it would have lead to decline of nearly seventy eight percent of operating income of Telecom Operators

This recent judgment is a result of this petition, wherein Supreme Court has supported telecom firms.

We are waiting for the full judgment, which would be available later in the day. And, also about TRAI’s next move regarding call drops.

Stay tuned!

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