Telecom Consumers Protection (Ninth Amendment) Regulations, 2015

The Supreme Court has provided massive relief to the telecom service providers by quashing Telecom Consumers Protection   (Ninth   Amendment)   Regulations,   2015, of the Telecom Regulatory Authority of India(TRAI) which made it mandatory for mobile network companies to compensate subscribers for call drops.

Background:

TRAI had made it mandatory for telcos to pay consumers Rs 1 per call drop, subject to a cap of Rs 3 a day. The regulation had come into force on January 1. This decision was challenged by telecoms, which lost their case in the Delhi High Court.

• Telecoms had argued that the order that penalized them was “populist” and unfair because connectivity is affected by factors beyond their control. They also argued that they’ve spent on installing two lakh telecom towers over the last 15 months.
• TRAI, on the other hand, had said that telecoms are earning huge amounts of revenue and can and should expand their investment in infrastructure.

What has the court said?

The court termed the TRAI notification as “flawed, unconstitutional, arbitrary and unreasonable”. The court was also of the view that a transparent procedure was not followed while evolving it.

• The court said the regulation which fastens strict liability on the telecom companies for no fault of theirs is arbitrary and violative of Article 14 of the Constitution.
• The court also observed that quality of Service Regulations allowed service providers a 2% allowance of call drops on the basis of averaging call drops per month and therefore, the companies cannot be penalised when they were complaint with this norm.
• Also, the court said, there is no legal basis or explanation in the 2015 Regulations as to why the compensation has been limited to only three call drops.

Way ahead:

The court has asked the Parliament to consider framing a law on the lines of an American law, US Administrative Procedure Act to ensure that all laws in form of executive policy and regulations are subject to a transparent process, which encourages due consultations with all stakeholders before the rule or regulation-making power is exercised. Not only would such legislation reduce arbitrariness in subordinate legislation-making, but it would also be conducive to openness in governance.