Kapil Sibal asks officials to apply mind while imposing penalties

Written by Press Trust of India | New Delhi | Updated: Sep 11 2013, 23:31pm hrs
KapilKapil Sibal urged officials to apply their minds while imposing fines on operators.
Communications and Information Technology Minister Kapil Sibal today urged officials to apply their minds while imposing fines on operators, failing which such powers may be handed over to the regulator.

At a meeting with Sibal, operators raised the issue of the Department of Telecom levying the maximum penalty of Rs 50 crore for even minor issues, hurting the industry.

"I hope officials in my ministry will apply their mind openly on every infraction and...impose penalty commensurate with the nature of the fault," Sibal said. "If they don't do that and I don't see any progress on that, I will have to give that power to TRAI so that it's taken from them."

The meeting was attended by Bharti Airtel Chief Executive Officer Gopal Vittal, Reliance Communications CEO Gurdeep Singh, Idea Cellular Managing Director Himanshu Kapania, Videocon Telecommunications CEO Arvind Bali and Tata Teleservices MD Srinath Narasimhan, among others.

"I have been trying to persuade my ministry officials to take a rational viewpoint. For every minor issue, they impose a penalty of Rs 50 crore, which is entirely irrational. This has hurt the industry and the government gets no revenue because those penalties are always stayed by court," Sibal told reporters after interacting with telecom sector leaders.

Vittal said there should be a clear set of criteria to determine major and minor violations and revenue loss.

"We have been levied a very large penalty of Rs 650 crore for revenue that we earned eight years ago of barely Rs 8 lakh," Vittal said.

Association of Unified Telecom Service Providers of India's (AUSPI) Secretary General, Ashok Sud said the industry faces combined penalties of about Rs 6,850 crore, which is burdening balance sheets and should be resolved soon.

"We should have a recourse to go to somebody when penalty is imposed, instead of directly going to court," Sud said.

The Cellular Operators Association of India requested Sibal to consider resolving court cases amicably, including those related to 3G intra-circle roaming, defining adjusted gross revenue and the hike in spectrum charges.

Sibal assured the industry the penalty issue would be resolved soon. He said the amounts are irrational in most cases and acknowledged that balance sheets of companies are skewed for that reason.

"They (companies) can't raise capital to put in money," Sibal said. "Why should government officials do things that hurt national interest when they are obliged to apply their minds based on the infraction and the quality of the infraction to impose penalty"

The minister said he has been able to resolve the penalty issue in cases of violation of radiation norms, where officials had imposed the maximum fine of Rs 5 lakh for delaying the submission of papers or not placing sign boards at some mobile towers.

The DoT had rejected suggestions by the Telecom Regulatory Authority of India (TRAI) that penalties of as much as Rs 10 crore should be imposed for major violations and up to Rs 25 lakh for minor violations.