RELIANCE COMMUNICATIONS LTD. ( KARNATAKA) Vs UNION OF INDIA

These applications have been filed praying for following reliefs- “(a) Clarify the order dated 06.02.2012 passed in Petition No. 25 of 2012 to state that the amount of 25% directed to be deposited by the Petitioner as a condition of stay would be calculated in terms of the interim orders dated 18.05.2011 and 03.06.2011 passed in Petition No. 252 of 2011; (b) Extend the time for making the deposit as directed by this Hon’ble Tribunal in its order dated 06.02.2012 passed in the above petition;”

2. The applicant has submitted that this Tribunal vide its order dated 18.5.2011 in Petition No. 252 of 2011 had directed the respondent not to take any coercive steps to implement its interpretation of the earlier order in terms condition of its letter dated

03.02.2011 subject to certain conditions of the operator to pay penalty at the same rate which they have been paying till 03.02.2011.

The same order was later confirmed by Tribunal in its order dated 03.6.2011.

3. The applicant further submitted that the Tribunal in its order dated 06.2.2012 further directed:- “19. We are of the view that each petition requires detailed examination after filing of reply by the respondent. However, keeping in view the interest of both the parties into consideration, we are of the opinion that interest of justice will be sub-served if the petitioners are directed to pay the 25% of the penalty imposed by the respondent within a period of one week. This order would, however, be subject to any other or further order which may be passed by the Tribunal.”

According to the applicant, the orders of the Tribunal on 18.5.2011 and 03.6.2011 passed in Petition No. 252 of 2011 and the order dated 06.2.2012 should be read together. However, the Respondent has informed orally that the Petitioner is not entitled to seek the benefit of order dated 18.5.2011 and 03.6.2011 as the same was not specifically mentioned in the order dated 06.2.2012.

4. The Respondent, on the other hand, contended that the Petitioner while arguing for the Petition No. 25 of 2012 and other connected cases on specific query by the Tribunal had informed the Tribunal that Petition No. 252 of 2011 was not applicable for the North East and Assam region. Even the amount of the dues which was payable in terms of the order of this Tribunal on 18.5.2011 has not yet been paid.

5. This Tribunal had issued an interim order dated 06.2.2012 in Petition No. 25 of 2012 and other connected cases without considering the effect of the orders of this Tribunal in Petition No. 252 of 2011. Although detailed arguments were heard on these petitions but the learned counsel for the parties did not bring to the notice of this Tribunal the said order and did not argue the effect of the same. The relevant portion of our order dated 06.2.2012 is reproduced below:- “15. After hearing both the parties, we are of the view that the licensor has the authority to issue instructions to the licensee as to the manner in which proof of identity and proof of address is to be supplied. However, it cannot be denied that the licensor considered certain documents valid for the proof of identity and proof of address till 19.07.2010 and again considered suitable for the same purpose after 30.03.2011 inspite of special security consideration of North East and Assam Area. It is necessary to examine whether the deletion of certain items as POA and POI were on substantial consideration of security or these were deleted in mechanical manner without due consideration just because these items did not exist for J&K.

16. Another question which arises for consideration in this petition is as to whether the Central Government could have issued directions to the telecom companies from time to time to accept certain kinds of documents which are not relevant for the purpose of verification and re-verification of the customers and exclude the documents which are relevant. It is contended by learned counsel appearing on behalf of the respondent that exclusion of the aforementioned three documents for the period in question was taken at the highest level, keeping in view the fact that in Jammu & Kashmir, North East and Assam are sensitive areas, the Central Government is entitled to take extra precaution in regard thereto. It is beyond any doubt or dispute that the petitioners are prima facie bound to pay penalty for non-compliance of the guidelines issued by the Central Government. At this stage it appears that no cogent reason has been assigned as to why same documents which were treated to be invalid for the purpose of customer verification for the period in question and then again found to be valid. 19. We are of the view that each petition requires detailed examination after filing of reply by the respondent.

However, keeping in view the interest of both the parties into consideration, we are of the opinion that interest of justice will be sub-served if the petitioners are directed to pay the 25% of the penalty imposed by the respondent within a period of one week. This order would, however, be subject to any other or further order which may be passed by the Tribunal.”

We would like to reproduce the relevant portion of the order dated 18.5.2011 and 03.6.2011 passed in Petition No. 252 of 2011 :

“Prima facie, we are of the opinion that the term “graded scales” have a definite connotation, particularly, in view of the fact that the percentage sofar as verification of a subscriber is concerned is required to be ascertained and “based on the percentage” referred to therein, so as to enable the respondents to `impose financial penalty of corresponding amount’.

If that be so, the question of each service provider paying penalty at different rates will not arise. The members of the Petitioners Association and in particular the service providers before us have to comply therewith and only in the event any deviation or departure is made therefrom, an appropriate action may be taken by DoT”.

The operating portion of the said order may be read, thus, “However, in the meantime, the respondent may not take any coercive step to implement its interpretation of the earlier order in terms of its letter dated 3.2.2011, subject to the following conditions:- (i) The operators shall pay the penalty at the same rate which they have been paying so long immediately before 3.2.2011. (ii) In the event the operators are intimated about the suspicious identity of any of the customers, his connection shall be withdrawn. (iii) In the event the DoT issues any instructions in this behalf the compliance thereof shall be intimated to DoT within three days thereafter. (iv) For the aforementioned purpose even a prima facie finding of the DoT shall sub-serve the purpose.”

6. The subject matter under consideration in Petition No. 252 of 2011 was issue of scheme of financial penalty for violation of terms and conditions of the licence agreement in respect of subscriber verification failure by way of circular issued on 24.12.2008 where the DOT introduced a system of imposing a scheme of penalty on subscriber verification failure cases at graded scale w.e.f. 1st April

2009. Subsequent circulars were also issued in this regard. However, vide circular dated 03.02.2011, DOT clarified the calculation of penalty in accordance with DOT letter dated 24.12.2008. According to it, the penalty is to be calculated as per rate applicable in the slab relating to the percentage of correct subscriber verification for all the CAFs in the Audit.

However, implementation of this circular was effectively stayed by us and we directed that the operators will continue to pay in the same manner as they were paying prior to issue of this circular.

7. The subject matter for the Petition Nos. 25, 26, 27, 28, 29, 41 of 2012 was the application of circular dated 20.07.2010 wherein the security guidelines to J&K were made applicable to Assam and North East areas.

8. While the question in Petition No. 252 of 2011 relates to the way of calculating the penalty amount in a slab system, the present petitions relate to the matter of considering the certain documents for the proof of address and proof of identification etc. The order in Petition No. 252 of 2011 was passed on the general principles.

Therefore, we are of the opinion that the orders dated 18.5.2011 and 03.6.2011 passed in Petition No. 252 of 2011 are applicable to these petitions also.

9. Regarding our order dated 06.02.2012, the order was passed on the consideration that no cogent reason were assigned for certain documents like certificate of photo identity issued by Village Panchayat Head and Caste and Domicile certificate with photo issued by State Government which were considered valid for the proof of identification and address till 19.07.2010 and again considered suitable for the same purpose after 30.03.2011. Here, we had directed to deposit 25% of the penalty imposed by the respondent within a period of one week.

10. Therefore, we would like to clarify our orders dated 18.5.2011 and 03.6.2011 passed in Petition No. 252 of 2011 will be applicable to these petitions also as a matter of principle and furthermore, only 25% of the penalty relating to failed CAF forms based on photo identity issued by Village Panchayat Head and Caste and Domicile certificate with photo issued by State Government shall be payable as an interim measure.

11. However, this order will be subject to the final order in these petitions as well as in Petition No. 252 of 2011.

12. These MAs are disposed of with aforementioned directions.

……………….. (S.B. Sinha) Chairperson

……………….. (P.K.Rastogi) Member /NC/