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2005 DIGILAW 32 (MAD)

Coimbatore District v. Union of India & Others

2005-01-07

A.K.RAJAN

body2005
Judgment :- The prayer in the writ petition is to issue a writ of certiorarified mandamus to call for the records of the second respondent in No.22-1/2001-PHB dated 27.3.2001 and quash the order in so far as it prohibits levy of service charges by STD/ISD/PCO franchisees. 2. The petitioners are STD/ISD/Public Telephone (Private) Operators Welfare Association. 3. The brief facts of the case are as follows: (i) The Ministry of Telecommunications announced a liberalised policy, by which Local/STD/ISD Pay phones were offered including the basic infrastructure to all those who volunteer to provide, operate and maintain the Pay phones. It was announced mainly to provide employment to unemployed youths and other eligible candidates. As per the New Policy, the private individual has to procure place for installation and install necessary equipment at their own cost and they have to carry out the instructions issued from time to time by the Department. The licence to run the booths is given to persons who satisfy the policy and guidelines issued by the Government. The members have to pay the rent for the premises, wages to the employees and other charges. There is no condition with regard to minimum distance between two pay phones and hence there is a heavy competition in this telecom industry. Of late, the members are finding it difficult to run the booths because of their dwindling income. The rates of commission payable to the booth operators have also been fixed. The circular dated 29.11.1999 further worsened the already deteriorating working conditions of the PCOs. Under the revised policy, the applications for allotment of booths are cleared as quickly as possible. The New Policy results in location of several booths without any regard for the necessity for additional booths. The members were entitled to collect service charge of Rs.2 for STD/ISD calls. But, after introduction of 91' facility on 15.8.1998, this Rs.2/- was not to be collected from the customers. Therefore, the income was considerably reduced. When the Government introduced 95' facility, i.e. intra circle calls, the pulse rate was also reduced and the status of such calls were altered. Therefore, franchisees were agitating for the service charge of Rs.2/-. But, it was turned down. Only a marginal increase of commission to 20 paise per call was allowed. The service charge levied for calls between 51 to 200 kms was taken away. Therefore, franchisees were agitating for the service charge of Rs.2/-. But, it was turned down. Only a marginal increase of commission to 20 paise per call was allowed. The service charge levied for calls between 51 to 200 kms was taken away. The second respondent issued a Circular dt.27.3.2001 providing for revision of commission and service charge for STD/ISD/PCO franchisees. The impugned order drastically affected the income of the franchisees by prohibiting the levy of service charges. The petitioner-Association represented to the authorities about their grievances but in vain. Hence, the present writ petition. (ii) The tariff order specifically permitted levy of service charge of Rs.2/- for calls made from PCOs in respect of STD/ISD calls. The calls between 51 and 100 kms of radial distance must also to be treated as STD calls as they have to go through STD lines and hence levying of service charge of Rs.2/- is legitimate; and denying that, is illegal. Hence, the impugned order is to be set aside. 4. In the counter affidavit it is stated as follows: (i) STD PCO franchisees had entered into an agreement with the Department of Telecommunications/BSNL and they have to abide by the terms and conditions as agreed to by the franchisees. There is no minimum distance between any two pay phones prescribed by the Department because public is expected to get the facility within their reach. Since the STD/PT operators accepted the terms and conditions before the allotment of STD PT, they cannot question the same. The present Orders referred to by the petitioner are policy of the Government of India, Department of Telecommunications (DoT). By the liberalised policy, the Government wanted to bring the telephone facility nearer to the public. If the STD/PCO franchisees are not able to get any minimum guaranteed amount as income, at the most, they can terminate the agreement with DoT/BSNL and surrender the STD PCO allotted to them, which is not at all objected to by DoT/BSNL and the condition is available in the agreement. DoT/BSNL distinguishes the calls as follows: (a) All telephone subscribers are given the facility of 91 and 95 dialling (local call facility) for all local calls, but no detailed billing is given. (b) Subscribers who want to have STD facility, i.e., 0' dialling, (detailed billing is available). (c) Subscribers who want to have ISD facility, i.e., 00' dialling, (detailed billing is available). (b) Subscribers who want to have STD facility, i.e., 0' dialling, (detailed billing is available). (c) Subscribers who want to have ISD facility, i.e., 00' dialling, (detailed billing is available). As such, whatever facility is offered to an ordinary subscriber, is to be given to the users of PCO also. As such, 91 and 95' services are given to all the ordinary subscribers and therefore no service charge can be levied for the PCO users of such calls by the STD PT operators. However, the Department/BSNL considered the plight of the franchisees and as a goodwill gesture, allowed service charge of Rs.2/- for urban areas and Re.1/- for rural areas for the calls beyond 101 kms and upto 200 kms. STD is only when the subscriber is allowed to dial the digit 0' as the first digit. So long as the subscriber is not dialling 0', it cannot be treated as STD call. The proposal for revision of service charges for STD/ISD PCO franchisees has been sent to TRAI by BSNL, and TRAI has neither intervened nor objected to the proposal of the above package. Therefore, this has been implemented from 1.4.2001. The decision for revision of commission to STD PCO franchisees was taken after considering the representations received from STD PCO operators and their Associations. Therefore, the writ petition is devoid of merits and the same is liable to be dismissed. 5. Mr. Chandramouli, learned Senior Counsel appearing for the petitioner-Association, submitted that the members of the Association were allowed to levy Rs.2/- as service charge for each call. But, by Order dt.27.3.2001, BSNL has revised the condition whereby "No service charge shall be collected on local calls, Inter SDCA Calls charged on 180 sec/unit and intra Circle calls of 100 kms. In the same order in para 2(v) it is stated that "Service Charge on inter Circle STD calls shall remain unchanged in urban as well as in rural areas. Franchisees can collect service charge upto Rs.2/- for each successful STD/ISD call as admissible at present." Therefore, relying upon Clause 2(v), the learned counsel submitted that the service charge for STD remains unchanged and the franchisees are entitled to Rs.2 as service charge when it is STD call. In the next clause it is stated that "no service charge shall be collected on Local Calls, Inter SDCA calls using 91' and 95' facilities". In the next clause it is stated that "no service charge shall be collected on Local Calls, Inter SDCA calls using 91' and 95' facilities". Therefore, this circular has been passed without application of mind. (i) Further, the members of the Association entered into the agreement only with TRAI, whereas the circular has been issued by BSNL. Therefore, this circular is not binding on the members of the Association. Therefore, the impugned circular is not applicable to the petitioner, and therefore, they are entitled to collect service charge of Rs.2 per call when dialed 91' or 95'. (ii) The learned Senior Counsel further contended that the power has been conferred on TRAI for giving the tariff. But, the change in tariff not made by TRAI but by BSNL. Such change has no authority of law as BSNL has no power to change the tariff. 6. The learned counsel appearing for the respondents referred to the "Telecommunications Tariff Order 1999". This is a statutory Order passed in exercise of the power conferred upon it under sub-section 2 of Sec.11 of The Telecom Regulatory Authority of India Act, 1997 (TRAI Act). Clause 7 of this Order reads as follows: "Reporting Requirement. - (i) All service providers shall comply with the Reporting Requirement in respect of tariffs specified for the first time under this Order and also all subsequent changes. (ii) No service provider shall alter any tariff of any telecommunication service or any part thereof without complying with the Reporting Requirement. (iii) Unless the Authority intervenes within the mandatory notice period of five working days, the service provider may implement the proposed tariff." As per sub-clause (iii) of Clause 7, unless the authority intervenes within the mandatory notice period of five working days, the service provider may implement the proposed tariff. Admittedly, BSNL is a service provider; it may implement the tariff as proposed by it. Such proposal for revision of tariff shall be implemented only after notice to TRAI. When such notice was given and TRAI had not intervened within five working days, then the service provider is free to implement the proposed tariff. In the present case, BSNL had given notice to TRAI by communication dated 27.3.2001 about the tariff change. Such proposal for revision of tariff shall be implemented only after notice to TRAI. When such notice was given and TRAI had not intervened within five working days, then the service provider is free to implement the proposed tariff. In the present case, BSNL had given notice to TRAI by communication dated 27.3.2001 about the tariff change. The document No.4, filed along with the annexure to the counter affidavit, reads as follows: "Proposal for revision of service charges for STD/ISD PCO franchisees referred by ADG(PHB) has been sent to TRAI on 27.3.2001. It is stated that TRAI has no so far intervened or objected to the proposal of tariff package. Necessary action may, therefore, kindly be taken for the implementation of the same." It was to come into force from 1.4.2001. In the letter dt.27.3.2001 (Annexure to the counter affidavit) it is found that "No service charge shall be collected on local calls, inter SDCA calls charged on 180 sec/unit and intra Circle calls of 50 to 100 kms." Further, it is stated as follows: "This intimation may kindly be treated as a reporting requirement on tariff change as required vide Clause 7 of Telecom Tariff Order, 1999". Referring to these documents, the learned counsel submitted that BSNL (service provider) had intimated about the proposed change in tariff to TRAI by letter dt.27.3.2001. But, TRAI had not objected to such change in tariff. Therefore, by operation of sub-clause (iii) of clause 7 it is a valid order. Since TRAI has not intervened within the mandatory notice period of five working days, the service provider(BSNL) had the right to implement the proposed tariff. The change of tariff has been made exercising the power conferred under the statutory order. Therefore, the contention that the agreement was entered into between the members of the Association and TRAI, and hence BSNL had no right to change the tariff has no force. 7. TRAI Act was passed by the Parliament. There is no dispute about the legislative Competency. Therefore, the contention that the agreement was entered into between the members of the Association and TRAI, and hence BSNL had no right to change the tariff has no force. 7. TRAI Act was passed by the Parliament. There is no dispute about the legislative Competency. Section 11 (2) of the TRAI Act reads as follows: "Functions of Authority.- (2) Notwithstanding anything contained in the Indian Telegraph Act, 1885 (13 of 1885), the Authority may, from time to time, by order, notify in the Official Gazette the rates at which the telecommunication services within India and outside India shall be provided under this Act including the rates at which messages shall be transmitted to any country outside India: Provided that the Authority may notify different rates for different persons or class of persons for similar telecommunication services and where different rates are fixed as aforesaid the Authority shall record the reasons therefor." The "Authority" is defined under S.2(b) of TRAI Act as follows: 2(b) "Authority" means the Telecom Regulatory Authority of India established under sub-section (1) of Sec.3. Therefore, TRAI is empowered to notify 'by order' in the official gazette the rates from time to time. 8. (a) Under Section III of this Order Clause 3 Tariffs for telecommunication services' has been prescribed as set out in Schedule I to IX in that order. Thus, 'Tariff' is fixed by TRAI. Clause 7 is 'Reporting Requirement'. Sub Clause (ii) provides that 'No service provider shall alter any tariff without complying with Reporting Requirement. Sub Clause (iii) provides that service provider may implement the proposed tariff unless the authority intervenes with the mandatory notice period of five working days. (b) A combined reading of Sub-Clauses (ii)&(iii) of Clause 7 would show that satisfying the reporting requirement, tariff can be changed. (c) Section IV of the Order is "Transparency and Consumer Protection". Clause 9 is "Publication of Tariffs", which reads as follows - "Publication of Tariffs. - (i) Tariffs to be charged by service providers from subscribers for telecommunication services along with the conditions thereof shall be published in such manner as the Authority may from time to time direct. (c) Section IV of the Order is "Transparency and Consumer Protection". Clause 9 is "Publication of Tariffs", which reads as follows - "Publication of Tariffs. - (i) Tariffs to be charged by service providers from subscribers for telecommunication services along with the conditions thereof shall be published in such manner as the Authority may from time to time direct. (ii) Information of tariff packages that a service provider may choose to offer to subscribers shall be accompanied by a comparison of the financial implications to subscribers under each package vis-a-vis the specified standard package(s)." The Telecom Tariff Order 1999 is a statutory Order. Clause 7 of the Statutory Order provides for 'change of tariff'. By which, the 'service providers' are given the right to change the tariff. As per the Order, 'tariff' can be changed by the service provider, subject to the procedure contemplated under the Order; any change in tariff shall be intimated to TRAI at least five clear working days before implementing any new tariff. If TRAI decides to intervene with that 'change of tariff', it has the right to intervene and to object for change in tariff. If the change is objected by TRAI, the proposed 'change of tariff' cannot be brought into force. On the other hand, if TRAI decides not to intervene, then, on completion of five clear working days after notice given by the service provider, the proposed change in tariff will come into operation. Therefore, this statutory requirement has been complied with when change in tariff and change in the service charge were effected. 9. According to the learned Senior Counsel for the petitioner, this amounts to delegation of power by TRAI to BSNL (or any service provider). Such a delegation is not authorised by the TRAI Act and hence BSNL has no right to change the tariff. 10. This argument, prima facie, appears to have force, is not acceptable. This argument is based on the ground that change in tariff is done by BSNL and TRAI. It is true that the change is made by BSNL (a service provider). But that change come into force only on the approval of TRAI. Therefore, the tariff is fixed (or approved) only by TRAI. The manner of approval is different from the conventional method. It is novel under the Act. That is when the change is not objected, it is deemed to have been approved. But that change come into force only on the approval of TRAI. Therefore, the tariff is fixed (or approved) only by TRAI. The manner of approval is different from the conventional method. It is novel under the Act. That is when the change is not objected, it is deemed to have been approved. It is only a different method of approval. Viewed in that manner, the change in tariff is brought or made only by TRAI and not by BSNL. 11. Therefore, the change in tariff and the change in service charge have been made by the statutory Order. The statutory Order provides for the change in tariff as well as change in the terms and conditions of the agreement between the members of the Association and TRAI and therefore the terms of the agreement is deemed to have been changed or modified by operation of law. By operation of law, the terms of the agreement have been modified and according to the modified order, the members of the Association are not entitled to collect service charge in certain categories as specified therein [when 91' and 95' facilities applied]. Therefore, the impugned Order is not illegal. Hence, no writ can not be issued as prayed for. 12. In the result, the writ petition is dismissed. No costs. Consequently, WPMP No.11159 of 2001 is dismissed.