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Reliance Info fined Rs 150 crore

November 26, 2004 17:25 IST
The department of telecom on Friday imposed a penalty of Rs 150 crore (Rs 1.5 billion) on Reliance Infocomm for violating licence conditions by routing international calls as local ones.

The department has given Reliance seven days to respond to the notice as to why this penalty should not be imposed.

When contacted, top officials of Reliance confirmed the receipt of the notice and said the company would seek extension of the time period.

This is besides the payment of about Rs 100 crore (Rs 1 billion) made by Reliance to Bharat Sanchar Nigam against a claim of over Rs 255 crore (Rs 2.55 billion) for avoiding payment of access deficit charge of Rs 4.25 per minute on incoming international calls.

Mahanagar Telephone Nigam has also claimed Rs 309 crore (Rs 3.09 billion) under the same clause. 

DoT took the decision to impose the penalty after seeking legal opinion from the Law Ministry. Even as Reliance had submitted its reply to DoT's first show cause notice on October 20, the department, after internal examination of the reply and legal consultation, took the decision to impose the penalty.

Meanwhile, Reliance had approached the Delhi High Court seeking to restrain BSNL from disconnecting the Points of Interconnection till the final outcome of the controversy of routing of calls.

Though the Delhi High Court had agreed to Reliance's demand, BSNL challenged Delhi High Court's order and filed a special leave petition in the Supreme Court saying the High Court does not have the jurisdiction to entertain such case as per the TRAI Act.

The case is slated to be heard on December 3. As per the licensing conditions, DoT can slap up to Rs 50 crore (Rs 500 million) penalty for each circle for the first offence and even take the action of cancelling the licence in case the operator continues to violate them.

DoT, however, is of the opinion that there was no loss to the exchequer. Financial losses have been caused only to BSNL and MTNL in terms of non-payment of access deficit charge to the tune of Rs 4.25 per minute on incoming international calls.

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