Telecom Disputes Settlement Tribunal
Cellular Operators Association Of ... vs Union Of India (Uoi) And Ors. on 27 September, 2003
JUDGMENT
1. I had the advantage to go through the order proposed by the learned Members but, with due respect to them, I am unable to agree to the interpretation given by them to the clause introduced in the licence agreement of FSPs. This clause is:
'The system shall be engineered to be connected to the telephone exchange of Short Distance Charging Area (SDCA) on Access Network Protocol based on National Standards for V5.2 as prescribed by Telecom Engineering Centre (TEC) or an approved improved version with latest technology'"
2. Connected with this would be the question whether FSPs can be allowed the use of MSC for offering wireless in WLL platform with limited mobility or that they are governed by the condition of the licence to use V5.2 interface which is the contention of the CMSPs. In short they say it has to be PSTN architecture and not PLMN architecture.
____________________________________________________________________________________ FSP: Fixed Service Provider and also referred to BSO i.e. Basic Service Operator CMSP: Cellular Mobile Service Provider and also referred to CMSO i.e. Cellular Mobile Service Operator.
WLL: Wireless in Local Loop WLL(M): Limited mobility in WLL platform MSC: Mobile Switching Centre PSTN: Public Switched Telephone Network PLMN: Public Land Mobile Network SDCA: Short Distance Charging Area DoT: Department of Telecommunications TRAI: Telecom Regulatory Authority of India (also referred to as Authority) ____________________________________________________________________________________
3. We may first consider arguments advanced by Mr. Salve appearing for the MTNL and Reliance Infocomm Ltd. , respondent nos. 4 and 7 as to the maintainability of petition itself. He raised two legal issues as to the locus standi of the petitioners who are CMSOs: (i) to challenge the right of the BSOs to the use of MSC in terms of their licence agreement whether in breach thereof or not and (ii) directions/recommendations of Authority after its recommendations dated 8.1.2001 could not have statutory force and the Central Government was not bound by that.
4. This Tribunal was constituted by the Amendment Act 2 of 2000 to the Telecom Regulatory Authority of India Act, 1997 w.e.f. 24.1.2000 ('Act' for short). Section 14 of the Act provides the powers and functions of the Tribunal and it is as under:
"14. Establishment of Appellate Tribunal. - The Central Government shall, by notification, establish an Appellate Tribunal to be known as the Telecom Disputes Settlement and Appellate Tribunal to -
(a) adjudicate any dispute-
(i) between a licensor and a licensee;
(ii) between two or more service providers;
(iii) between a service provider and a group of consumers:
Provided that nothing in this clause shall apply in respect of matters relating to -
(A) the monopolistic trade practice, restrictive trade practice and unfair trade practice which are subject to the jurisdiction of the Monopolies and Restrictive Trade Practices Commission established under sub-section (1) of section 5 of the Monopolies and Restrictive Trade Practices Act, 1969 (54 of 1969);
(B) the complaint of an individual consumer maintainable before a Consumer Disputes Redressal Forum or a Consumer Disputes Redressal Commission or the National Consumer Redressal Commission established under section 9 of the Consumer Protection Act, 1986 ( 68 of 1986);
(C) dispute between telegraph authority and any other person referred to in sub-section (1) of Section 7B of the Indian Telegraph Act, 1885 (13 of 1885)
(b) hear and dispose of appeal against any direction, decision or order of the Authority under this Act.
Mr. Salve's argument was that when it is required to adjudicate any dispute between aa licensor and licensee, it has to be with reference to the licence granted by the licensor to the licensee and any third party or any other licensee cannot have any locus to step in.
Clauses (e), (ea) and (j) of Section 2(1) of the Act define Licensee, licensor and service provider as under:
"(e) 'Licensee' means any person licensed under sub-section (1) of section 4 of the Indian Telegraph Act, 1885 (13 of 1885) for providing specified public telecommunication services".
(ea) 'licensor' means the Central Government or the telegraph authority who grants a licence under section 4 of the Indian Telegraph Act, 1885 (13 of 1885)".
(j) 'service provider' means the Government as a service provider and includes a licensee".
5. If we accept the argument of Mr. Salve it will have wide ramifications inasmuch as if any term of licence between the licensor and licensee has any impact on the licence of the petitioner he cannot come to the Tribunal and has to seek his remedy elsewhere. We do not think such a result could ever be contemplated. If the licensor amends the terms of licence of a licensee as in the present case that of BSOs which affects the right of the petitioners-CMSOs, even if marginally, the petitioners can certainly raise a dispute to be adjudicated by this Tribunal and this would be the dispute between the licensor and the petitioners as the licensees. We are unable to accept the contention of Mr. Salve that the petitioners did not have any right to file this petition.
6. Mr. Salve referred to the powers and functions of the Authority which was established under the Act. The Preamble to the Act after its amendment in the year 2002 reads as under:
"An Act to provide for the establishment of the Telecom Regulatory Authority of India and the Telecom Disputes Settlement and Appellate Tribunal to regulate the telecommunication services, adjudicate disputes, dispose of appeals and to protect the interests of service providers and consumers of the telecom sector, to promote and ensure orderly growth of the telecom sector and for matters connected therewith or incidental thereto".
7. Authority is a body corporate and it consists of a Chairperson, not less than two whole time members and two part-time membeRs. Section 4 of the Act prescribes qualification of the Chairperson and other membeRs. They are to be appointed by the Central Government from amongst persons who have special knowledge of, and professional experience in, telecommunication, industry, finance, accountancy, law, management or consumer affaiRs. Sections 5 to 10 falling under Chapter II of the Act refer to the terms of office, conditions of service, etc., of Chairperson and other members; powers of Chairperson and Vice-Chairperson; removal and suspension of member from office in certain circumstances; holding of meetings of the Authority; protection against invalidation of the meetings of the Authority on account of any vacancy or defect in appointment or any irregularity in procedure; officers and other employees of the Authority.
8. Chapter III prescribes the powers and functions of the Authority. When Authority is to conduct investigation, its powers to call for information are given in Section 12. Section 13 gives powers to the Authority to issue directions. Section 29 prescribes penalty for contravention of directions of Authority. When any offence has been committed under the Act or the Rules and Regulations made thereunder a complaint in a criminal court can be filed at the instance of the Authority (Section 34). Where an offence under the Act had been committed by any department of the Government, the head of the department shall be liable to proceed against and punished accordingly unless he proves his case under the exception (Section 31). All these provisions show that Authority is not a toothless boDy. It is an expert body and exercises statutory poweRs.
9. Section 11 of the Act which prescribes functions of the Authority and on which the argument was based, reads as under:
"11. Functions of Authority. - [(1) Notwithstanding anything contained in the Indian Telegraph Act, 1885 (13 of 1885), the functions of the Authority shall be to-
(a) make recommendations, either suo motu or on a request from the licensor, on the following matters, namely:-
(i) need and timing for introduction of new service provider;
(ii) terms and conditions of licence to a service provider;
(iii) revocation of licence for non-compliance of terms and conditions of licence;
(iv) measures to facilitate competition and promote efficiency in the operation of telecommunication services so as to facilitate growth in such services;
(v) technological improvements in the services provided by the service providers;
(vi) type of equipment to be used by the service providers after inspection of equipment used in the network;
(vii) measures for the development of telecommunication technology and any other matter relatable to telecommunication industry in general;
(viii) efficient management of available spectrum;
(b) discharge the following functions, namely:-
(i) ensure compliance of terms and conditions of licence;
(ii) notwithstanding anything contained in the terms and conditions of the licence granted before the commencement of the Telecom Regulatory Authority of India (Amendment) Act, 2000, fix the terms and conditions of inter-connectivity between the service providers;
(iii) ensure technical compatibility and effective inter-connection between different service providers;
(iv) regulate arrangement amongst service providers of sharing their revenue derived from providing telecommunication services;
(v) lay-down the standards of quality of service to be provided by the service providers and ensure the quality of service and conduct the periodical survey of such service provided by the service providers so as to protect interest of the consumers of telecommunication service;
(vi) lay-down and ensure the time period for providing local and long distance circuits of telecommunication between different service providers;
(vii) maintain register of interconnect agreements and of all such other matters as may be provided in the regulations;
(viii) keep register maintained under clause (vii) open for inspection to any member of public on payment of such fee and compliance of such other requirement as may be provided in the regulations;
(ix) ensure effective compliance of universal service obligations;
(c) levy fees and other charges at such rates and in respect of such services as may be determined by regulations;
(d) perform such other functions including such administrative and financial functions as may be entrusted to it by the Central Government or as may be necessary to carry out the provisions of this Act;
Provided that the recommendations of the Authority specified in clause (a) of this sub-section shall not be binding upon the Central Government;
Provided further that the Central Government shall seek the recommendations of the Authority in respect of matters specified in sub-clauses (i) and (ii) of clause (a) of this sub-section in respect of new licence to be issued to a service provider and the Authority shall forward its recommendations within a period of sixty days from the date on which that Government sought the recommendations:
Provided also that the Authority may request the Central Government to furnish such information or documents as may be necessary for the purpose of making recommendations under sub-clauses (i) and (ii) of clause (a) of this sub-section and that Government shall supply such information within a period of seven days from receipt of such request:
Provided also that the Central Government may issue a licence to a service provider if no recommendations are received from the Authority within the period specified in the second proviso or within such period as may be mutually agreed upon between the Central Government and the Authority:
Provided also that if the Central Government having considered that recommendation of the Authority, comes to a prima facie conclusion that such recommendation cannot be accepted or needs modification, it shall, refer the recommendation back to the Authority for its reconsideration, and the Authority may within fifteen days from the date of receipt of such reference, forward to the Central Government its recommendations after considering reference made by that Government. After receipt of further recommendation if any, the Central Government shall take a final decision.
(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.
(3) While discharging its functions under sub-section (1) or sub-section (2) the Authority shall not act against the interest of the sovereignty and integrity of India, the security of the State, friendly relations with foreign States, public order, decency or morality.
(4) The Authority shall ensure transparency while exercising its powers and discharging its functions.
10. Section 12 of the Act which prescribes power of Authority to call for information, conduct investigation etc. is as under:
"12. Powers of Authority to call for information, conduct investigation etc.-
(1) Where the Authority considers it expedient so to do, it may, by order in writing, -
(a) call upon any service provider at any time to furnish in writing such information or explanation relating to its affairs as the Authority may require; or
(b) appoint one or more persons to make an inquiry in relation to the affairs of any service provider; and
(c) direct any of its officers or employees to inspect the books of account or other documents of any service provider.
(2) Where any inquiry in relation to the affairs of a service provider has been undertaken under sub-section (1) -
(a) every officer of the Government Department, if such service provider is a department of the Government;
(b) every director, manager, secretary or other officer, if such service provider is a company; or
(c) every partner, manager, secretary or other officer, if such service provider is a firm; or
(d) every other person or body of persons who has had dealings in the course of business with any of the persons mentioned in clauses (b) and (c), shall be bound to produce before the Authority making the inquiry, all such books of account or other documents in his custody or power relating to, or having a bearing on the subject-matter of such inquiry and also to furnish to the Authority with any such statement or information relating thereto, as the case may be required of him, within such time as may be specified.
(1) Every service provider shall maintain such books of account or other documents as may be prescribed.
(2) The Authority shall have the power to issue such directions to service providers as it may consider necessary for proper functioning by service provideRs.
11. Mr. Salve said that when a recommendation is made suo motu, by the Authority or on a request from the licensor, the Central Government is not bound to accept the recommendations of the Authority. He said in respect of recommendations falling under sub-clauses (i) and (ii) of clause (a) of Section 11(1) procedure has been prescribed for the Central Government to examine the recommendations of the Authority but there is no procedure regarding other recommendations under sub-clauses (iii) to (viii) of clause (a). He said that the recommendation of the Authority not to use MSC and to use only V5.2 interface or any approved improved version with latest technology would be one under sub-clause (vi) of clause (a) and has no binding force and the Central Government has a right to allow use of MSC. On first blush there certainly appears to be some persuasive force in the arguments of Mr. Salve. His argument was that first proviso to Section 11 clearly stipulated that Central Government is not bound by any recommendation of the Authority specified in clause (a) of sub-section (1). But then if we accept the same, the Authority becomes an unproductive body serving no purpose and not an independent expert body envisaged by the Act to regulate telecommunication services in the country but perhaps just any other department of the Government. That was never the object of the Act keeping in view the preamble which we have set out above and the functions and powers of the Authority. By accepting such an argument we cannot make the Act worthless., a useless piece of legislation. Take for example of power of the authority to ensure compliance of terms and conditions of licence. This is one of the functions the Authority which it is mandatorily to discharge under sub-clause (i) of clause (b) of Section 11. For that purpose the Authority can exercise powers under Section 12 of the Act. After finding that the licensee has not been complying with the terms and conditions of the licence the Authority recommends to the Central Government, the licensor, for revocation of licence for non-compliance of terms and conditions of the licence. This recommendation would be under sub-clause (iii) of clause (a). Could it be said that Government can treat that recommendation as a scrap of paper and consign it to the waste paper basket? Certainly not. Otherwise also, Government will have to give reasons for not accepting the recommendations of the Authority, even if we accept the argument of Mr. Salve. Otherwise the Authority will look absolutely ineffective and its functions can as well be performed by any of the Departments of the Central Government. It is mandatory for the Authority to make recommendations either suo motu or on the request of the licensor, the Central Government. Licensor must seek recommendations in respect of all the sub-clauses in clause (a). But as regards sub-clauses (i) and (ii) special procedure has been prescribed giving the time schedule. To us it appears that we have to adopt a constructive and purposeful approach in interpreting the provisions of Section 11 and we cannot accept an argument which strikes at the bottom of very existence of the Authority. It is undeniable that Authority is an expert body constituted under the Act and it has been held to be so by the judgement of the Supreme Court in the case of Cellular Operators Association of India & ORs. v. Union of India & ORs. - (2003) 3 SCC 186.
12. To us it is quite apparent that recommendations of the Authority in respect of sub-clauses (i) to (viii) are must whether these recommendations are made suo motu by the Authority or on the request of the licensor. When the Authority makes recommendation it does so only after following the set transparent procedure. Even if nothing has been mentioned as to how the recommendations are to be considered by the Central Government when the Government does not accept those recommendations, it has to be seen how the Central Government has considered those recommendations and the reasons therefor not to accept the same or even to accept the same with certain modifications. Central Government has to communicate to the Authority its reasons for non-acceptance of the recommendations and the Authority will then consider those points and make further recommendations. Unless recommendations are there with respect of sub clauses (iii) to (viii) of the Authority, Central Government cannot treat the recommendations or absence thereof as authorising it to act otherwise. It is therefore not correct for Mr. Salve to say that in the absence of any recommendations of the Authority or there being any non-acceptance consideration of the recommendations of the Authority by the Central Government it can prescribe any type of equipment to be used by the service providers after inspection of the equipment used in the network as provided in sub clause (vi) of clause (a). In any case letters of the TRAI written to DoT after its recommendations dated 8.1.2001, as we will hereinafter show, are not recommendations as envisaged in Section 11(1) (a) of the Act.
13. This Tribunal by majority judgment dated 8.8.2003 in Cellular Operators Association of India & ORs. v. Union of India & ORs. (Petition No. 1 of 2001) held that Central Government is competent to amend the licence and that this power of the Central Government could not be questioned. In pursuance to this power exercised by the Central Government FSPs were allowed to provide limited mobility in WLL (Wireless in Local Loop) platform [WLL(M)]. This was indeed a shift in the approach of the Government when it accepted the recommendations dated 8.1.2001 of the Authority and by its decision made on 25.1.2001 permitted FSPs to offer WLL(M) service. It has been mentioned that the decision to allow limited mobility to FSPs was no doubt taken with extraordinary speed of the decision-making process in the last fortnight of January 2001 when the Government does usually follow a more relaxed, meandering path. The majority order however, did not impute any motive to the Government. There are certainly distinct features of the two services that provided by CMSPs and FSPs and the Government also felt that two services are qualitatively different. On the question of extent of mobility TRAI held that extension of WLL mobility only upto the local area i.e. SDCA (Short Distance Charging Area) will be the most optimal solution and serve interest of telecom growth in the country best.
14. We may refer to paras 42 and 45 of the judgement dated 8.8.2003 of the Tribunal in Cellular Operators Association of India & Ors v. Union of India & ORs. - Petition No. 1 of 2001 where the question of MSC and extent of mobility has been considered:
"42. TRAI had also held that in cellular mobile systems which are operational in a large number of telecom circles in the country, there is a Mobile Switching Centre (MSC) capable of extensive mobility, management/roaming function while the WLL systems are engineered differently to provide the so called "Last Mile" linkage with the existing exchange and they do not have an exchange namely, MSC as part of the WLL system. Keeping this essential difference in view and the intrinsic character of WLL, the TRAI recommended that basic service operator be allowed to offer WLL with mobility within the local area i.e. SDCA.
43. .................................................................................
44. .................................................................................
45. It seems to us that the TRAI had in mind this essential difference between the two services when it recommended WLL with limited mobility within the local area for the basic service operatoRs. We also recognize that to an ordinary subscriber in a SDCA who does not want any roaming outside the SDCA or any other supplementary services offered by CMSPs it would appear as if there is virtually no difference between WLL(M) services offered by Basic Service Operators and those offered by CMSPs without supplementary services, excepting one important difference - WLL(M) services are non-functional outside the SDCA even though the service area of the Basic Service Operator may comprise of several SDCAs. This disability is not there in respect of services provided by CMSPs which are available throughout the service area which may have several SDCAs. There are other important differences in terms of scope of service, quality, coverage, frequency band of operation, numbering plan, traffic routing plan etc. The roll-out obligations of the two services are also quite different. Cellular Operators are required to cover only 50% District Headquarters or any other town in lieu thereof while the Basic Service Operators are required to cover 80% of SDCAs individually and 20% jointly. The most crucial difference however is that the WLL(M) handset can not be authenticated except in the SDCA itself. It has been alleged by CMSPs that several basic service operators are flouting this restriction on mobility and that it is not possible to police this restriction. If this is indeed so, appropriate action would have to be taken by the Government to ensure that this does not happen; but that would be a different issue and we are separately looking into it. We however do not find that the two services have become substitutable in view of the substantial differences, as listed above, existing between them. In the ultimate analysis, as foreseen by NTP 1999, such service distinctions may become archaic and obsolete in the context of convergence of market and technologies and a prudent approach would be to facilitate this process rather than try to put restrictions.
15. Then in para 46 following observations from the recommendations of the Authority were noticed:
"Although both WLL systems and Mobile systems employ similar Air Interface and network infrastructure such as cells, there are significant differences between the two. While in Cellular Mobile systems, such as GSM based networks which are operational in a large number of telecom circles in the country, there is a mobile exchange called mobile switching center (MSC) capable of extensive mobility management/roaming function, the WLL systems are engineered essentially to provide the so-called 'last mile' linkage with the existing exchange, and these do not have an exchange, viz., mobile switching center as part of the WLL system. Considering this essential difference and also the intrinsic characteristics of WLL as indicated by the nomenclature itself, i.e., 'local loop', the TRAI is of the view that extension of WLL mobility only upto the local, i.e., SDCA will be the most optimal solution and serve interest of telecom growth in the country best. Accordingly, the Authority recommends that the Basic Service Operator(BSO) be allowed to offer WLL with mobility within the local area, i.e., Short Distance Charging Area(SDCA)".
It was then commented:
"Quite apart from the fact that this issue viz., use of MSC by WLL(M) Operators is the subject matter of another challenge by the CMSPs which is already before us for consideration, we do not find any express permission to the use of MSC architecture by FSPs in the guidelines issued by the Government on 25.01.2001".
16. While the Tribunal did not find any express permission to use of MSC architecture by FSPs in the guidelines dated 25.1.2001, BSOs found that there was no bar in the use of MSC architecture in the guidelines and thus they claimed they had right to use the same.
17. To understand the rival contentions it would be appropriate to see the background under which recommendations dated 8.1.2001 were made by the Authority and accepted by the Central Government on 25.1.2001 and the guidelines issued thereafter on the same day. At the outset, it must be noticed that recommendations by Authority are not to be scrutinised as a statutory document and one has to see whole of the discussions in the recommendations to understand what was the Authority aiming at while recommending limited mobility to the FSPs in WLL platform when earlier in their licence they were entitled to WLL only for "last mile" connectivity i.e. WLL (fixed). This Tribunal in its earlier judgment in petition No. 1 of 2001 (para 46) had noticed the paragraph of the recommendations of the Authority which can be paraphrased as under.
1. The Authority is of the view that considering the entitlements under the two licenses i.e. one for the Fixed Service offered by BSOs and the other offered by the CMSOs with full mobility and roaming facility, in the interest of level playing field, there is need to maintain a clear service differentiation.
2. Although both WLL systems and Mobile systems employ similar Air Interface and network infrastructure such as cells, there are significant differences between the two. While in cellular mobile systems, such as GSM based networks which are operational in a large number of telecom circles in the country, there is a mobile exchange called mobile switching centre (MSC) capable of extensive mobility management/roaming function, the WLL systems are engineered essentially to provide the so called 'last mile' linkage with the existing exchange, and these do not have an exchange viz. mobile switching centres as part of the WLL system.
3. Considering this essential difference and also the intrinsic characteristics of WLL as indicated by the nomenclature itself i.e. 'local loop', the TRAI is of the view that extension of WLL mobility only up to the local area i.e. SDCA will be the most optimal solution and serve interest of telecom growth in the country best.
4. Accordingly, the Authority recommends that the Basic Service Operator (BSO) be allowed to offer WLL with mobility within the local area i.e. Short Distance Charging Area (SDCA)."
18. Whole of the para forms part of the recommendations and it cannot be confined to sub para 4 to hold that there is no bar to the use of MSC by WLL (M) as contended by FSPs and now also by the Union of India. We are of the view that the petitioners are correct when they say that in the first part of the paragraph TRAI said that distinction needs to be maintained between the WLL (M) and cellular mobile service operators and sub para two states that MSC is the key factor that causes such distinction and ensures that it remains so and thus the resultant service is what is limited within the local area i.e. SDCA which is also so considering the national interest and all this led the Authority to recommend that BSO be allowed to offer limited mobility within the SDCA.
19. After accepting the recommendations dated 8.1.2001 of the Authority allowing limited mobility to FSPs, Central Government issued guidelines on 25.1.2001 which is para 18 and is as under:
"18. Basic Service Operator shall be allowed to provide mobility to its subscribers with Wireless Access Systems limited within the local area i.e. Short Distance Charging Area (SDCA) in which the subscriber is registered. While deploying such systems, the operator has to follow numbering plan of that Short Distance Charging Area (SDCA) and it should not be possible to authenticate and work with the subscriber terminal equipment in SDCAs other than in which it is registered. The system shall also be engineered so as to ensure that hand over of subscriber does not take place from one SDCA to another SDCA while communicating. Further, the operator shall ensure that the Radio Transmitters may be located and established at a distance of 10 KMs from the international border of India, and such radio transmitters will work in such a fashion that any signal or signals, emanating therefrom, fade out when nearing or about to cross international border and also become unsuable with a reasonable distance across such border".
20. On 20.3.2001 TRAI, an expert body, wrote a letter to DoT, referring to its recommendations dated 8.1.2001 that DoT might like to request TEC to draw up a system of engineering specification, "so that WLL systems do not have a Mobile Switching Centre (MSC) and are also engineered to ensure that handover of subscribers does not take place from one SDCA to another. The system specification should also specify numbering routing and charging as applicable to WLL systeMs. Suitable clause may be incorporated in the license agreement of BSOs, to provide for system testing to check its conformance to TEC specification, before permission to commence service is given by the licensor". TRAI also pointed out that conformance to TEC specification be secured before allowing them to offer limited mobility services. Again on 19.4.2001 TRAI wrote a letter to DoT with a request to it to technically specify a wireless local loop system as an access system to be connected to a local exchange by a standard V5.2 interface and to incorporate suitable clause in licence agreement. Other request to DoT was to require TEC to prepare a GR incorporating guidelines on interface, area of coverage and numbering requirements. On 18.5.2001 TRAI Telecommunication Tariff Order (14th Amendment) was notified which Order is statutory. In this TRAI specifically provided that in view of its earlier recommendations on WLL (M) system which is part of PSTN (Public Switched Telephone Network) i.e. of fixed exchange should not include MSC (i.e. mobile exchange), otherwise there will be no difference between a mobile network i.e. PLMN (Public Land Mobile Network) operated by CMTS, and a PSTN operated by BSOs. Relevant extracts from this Tariff Order we quote:
"For WLL (M), the Authority's recommendations provide for mobility within a short distance charging area (SDCA). In this regard however the extent of mobility provided will be the choice of the service provider, subject to the condition that the maximum mobility will not extent beyond the SDCA".
"In conformity with the Authority's recommendations, service providers were also asked to engineer their wireless access systems around a BSC which should be directly connected to a Local Exchange (LE) by a V5.2 Interface, specified by ITU to connect an access node to a local exchange of a PSTN".
"The Authority would like to reiterate its earlier recommendation that a WLL (M) system which is part of a PSTN, should not include a MSC, otherwise there will be no difference between a mobile network i.e. PLMN operated by CMTS, and a PSTN operated by BSOs".
"TRAI is of the view that in order to maintain clear distinction between WLL (M0 and cellular mobile service with fully mobility, the former i.e. WLL (M) service, should not be engineered based on a Mobile exchange and a PLMN configuration. Accordingly cost data for systems based on MSC, i.e. Mobile Exchange and PLMN configuration, have not been taken into account, while computing the cost based rental for the Most Efficient Private Operator (MEPO). Rather it should be interfaced with a local exchange of a PSTN based on a ITU specified interface V5.2".
21. Then there are letters written by COAI and other CMSPs complaining either to DoT or to TRAI that BSOs were providing mobile services with MSC and without the use of V5.2 interface. DoT was requested to take action so that wireless excess system used by FSPs should conform to PSTN architecture.
22. On 22.8.2001 DOT wrote letter to FSPs in continuation of its earlier letter dated 25.1.2001 conveying the decision of the Government that wireless access systems of V5.2 interface shall be planned and engineered in the following manner.
'The system shall be engineered to be connected to the telephone exchange of Short Distance Charging Area (SDCA) on Access Network Protocol based on National Standards for V5.2 as prescribed by Telecom Engineering Centre (TEC) or an approved improved version with latest technology'."
23. Licences of new FSPs were also amended:
"2.2 (c ) (i) The LICENSEE is allowed to provide mobility to its subscribers with Wireless Access Systems but limited to the local area i.e. Short Distance Charging Area (SDCA) in which the subscriber is registered. While deploying such systems, the LICENSEE has to follow the numbering plan of the respective Short Distance Charging Area (SDCA) within which the service is provided and it should not be possible to authenticate and work with the subscriber terminal equipment in SDCAs other than the one in which it is registered. The system shall also be so engineered to ensure that hand over of subscriber does not take place from one SDCA to another SDCA while communicating.
2.2 (c ) (ii) Further, the LICENSEE shall ensure that the Radio Transmitters are located and established at a distance of 10 KMs from the international border of India, and such radio transmitters will work in such a fashion that any signal or signals, emanating therefrom, fade out when nearing or about to cross international border and also become unusable within a reasonable distance across such border.
2.2.(c)(iii): Further such system shall be engineered to be connected to telephone exchange of Short Distance Charging Area (SDCA) on Access Network Protocol based on National Standards for V5.2 as prescribed by Telecom Engineering Centre or an approved improved version with latest technology'."
24. It is stated in the letter dated 28.9.2001 from TRAI to DoT, there is a reference of its earlier letter dated 17.7.2001 to DOT wherein TRAI had written to DoT seeking deletion of the expression "or approved improved version with latest technology" from the basic service licence agreement. Letter dated 28th September, 2001 of the TRAI to Dot is reproduced as under:
"Kindly refer to my earlier letter dated 17th July 2001 regarding the deletion of the expression "or an approved improved version with latest technology" from the Basic Service Licence Agreement on the use of V5.2 as subscriber access interface for the WLL (M) service. It is observed that Clause 2.2(c)(iii) of the new Licence Agreement for provision of Basic Telephone Service states "Further such system shall be engineered to be connected to Telephone Exchange of Short Distance Charging Area (SDCA) on Access Network protocol based on National Standards for V5.2 as prescribed by Telecom Engineering Centre or an approved improved version with latest technology".
It may be recalled that the Standing Committee of Parliament on IT in their 17th Report have also stressed the need to maintain a significant difference in the scope of service provided through WLL (M) and GSM based CMTS. In line with the views expressed by the Standing Committee, TRAI had recommended use of V5.2 Interface using PSTN architecture in WLL (M) Services. However as the expression "or an approved improved version with latest technology" offers room for alternatives to the system prescribed by TEC, it can be used to bring in an unspecified system with elements of PLMN rather than PSTN. In the light of what has been stated above, it is requested that the DOT may ensure that the Basic Service Operators while using WLL technology provide the service of limited mobility only under following conditions:
. The limited mobility is provided to their subscribers only within the local area i.e. Short Distance Charging Area in which the subscriber is registered.
. The Numbering Plan of the respective SDCA within which the service is provided is strictly followed.
. Handover of calls does not take place from one SDCA to another SDCA while communicating.
. TEC approval is obtained for the subscriber access interfaces at the time of commissioning of the Network and also as and when any improved version is to be inducted. For this purpose a WLL specification will need to be drawn up by TEC and its conformance checked.
. PSTN architecture is not tampered with.
Periodic Inspection in this regard by the Licensor are also considered relevant by TRAI. This should be applicable for both the existing and new Basic Service Licenses."
25. This letter was from Shri Harsha Vardhana Singh, Secretary, TRAI to Shri P.K. Mittal, DDG (Basic Services), DOT. It was replied to by Secretary, DOT to the Chairman, TRAI by letter dated 17.10.2001 which we also reproduce:
"This has reference to TRAI letter No. 411-3/2000-FN dated 28th September 2001 regarding use of V5.2 protocol in WLL with limited mobility.
2. Earlier, TRAI has written to us based on some newspaper reports and suggested deletion of an expression in the license agreement vide letter No. 411-3/2000-FN dated July 17, 2001. It was clarified to TRAI vide letter No. 10-2/2001-BS.II dated 1st August 2001 that the matter has been examined and under the circumstances, no change seems necessary. You may kindly recall that I had clarified the position in this regard when I last met you and had stated that the existing licensing provision envisages adequate safeguards.
3. I feel it is not desirable to base any correspondence on newspaper reports. As the matter had been examined and TRAI informed accordingly, it is desirable that the matter should be allowed to rest there and further correspondence may be avoided.
4. It may be appreciated that we should not create any uncertainty in this regard which will act as an impediment to roll out".
26. Thereafter, to this a reply was sent by TRAI through its Chairman which is dated 23.10.2001 and may be reproduced :
"This has a reference to your D.O. No. 10-3/97-BS.II/VO.II.
The letter raises certain questions which should be addressed.
The matter central to the issue of permitting the Basic Service Operators to add WLL (M) to their services is the nature of mobility. The WLL mobility has been limited within the SDCA so that it remains clearly different from the mobility available in the Cellular Mobile Services which is unlimited. This difference between the two services must remain clear and anything that blurs the distinction would create uncertainties mentioned in the concluding paragraph of your letter, which we must not create, not only in the interest of roll-out of the service but also in the interest of growth of telecommunication service as a whole.
The letter also seems to be questioning the desirability of the correspondence itself as it is said to be based on newspaper reports. This, to my mind, does not reflect a proper appreciation of the situation. The correspondence and the urgency shown by the TRAI underline the concern over the issue which in its assessment has potentials of gaining difficult proportion, if not handled properly right from the beginning. We are all aware of its contentious nature and the fact that some of the interested parties are already litigating about it.
The enquiries made by the TRAI from the DOT over the past few weeks and the suggestions given on the subject have all been aimed at keeping the issue clear of contentions and with a view to ensuring that it does not get mired into further controversy. The correspondence was, therefore, not avoidable as the letter seems to suggest.
TRAI has taken note of the clarifications provided by the DOT and is particularly appreciative of the efforts made by you personally to clarify that the existing licensing provision envisages adequate safeguards. It may, however, be appreciated that two assessments about the adequacy and efficacy of a particular safeguard often differ. This appears to be so in the present case, and TRAI would be failing in its duties as the Regulator if it does not, at least, inform the Government that its assessment is at variance with that of the DOT.
TRAI hopes that the safeguards provided in the license will prove adequate to ensure the desired distinction between the two services i.e. WLL (M) and the Cellular Mobile Services and also expects that should, for any reason, the currently provided safeguards fail, other effective measures will be adopted to maintain the distinction required to be maintained under the two licenses.:
27. It was submitted by the Union of India and BSOs that the letters written by the TRAI after 8.1.2001 were in the nature of fresh recommendations and since the process of consultation had not been gone into these were not binding on the Central Government even otherwise. We do not think that the letters of the TRAI though written after 8.1.2001 are in the form of any independent recommendations. By these letters TRAI is correcting the erroneous presumption made by the Central Government as to the its recommendations which had been accepted by the Central Government without any reservation. There cannot be any better person other than the TRAI to explain what its recommendations were and what these meant, when any doubt is expressed in any quarter.
28. In State of Tamil Nadu v. Mahji Traders & ORs. (1989) 1 SCC 724 the question before the Supreme Court was: could leather splitsbe categorised as cut pieces of hides and skins. The authorities under the Sales Tax Act, 1957 had given different interpretation. Supreme Court held that leather splits are nothing but cut pieces of hides and skins. In coming to this conclusion Supreme Court referred to certain publications on leather terminology. It then observed that similar opinion was rendered by the leather development wing of the Ministry of Commerce and Industry at the earliest point of time i.e. when Central Sales Tax Act came into force on April 1, 1957 and a doubt had arisen as to the scope of expression used by the Act. The Supreme Court said that the Department which rendered the opinion was fully conversant with this branch of trade and the opinion was given after considering the technicalities of the process employed in the manufacture of finished leather. The Court held that a contemporaneous exposition by the administrative authorities is a very useful and relevant guide to the interpretation of the expressions used in the statute. This is how the Supreme Court considered the question:
"8. It has been pointed out by this Court in Desh Bandhu Gupta v. Delhi Stock Exchange Association Ltd. and K.P. Varghese v. ITO that a contemporaneous exposition by the administrative authorities is a very useful and relevant guide to the interpretation of the expressions used in a statute. Considering that the above clarification was sought for at the earliest point of time when a doubt arose as to the scope of the expression used by the statute and given after considering the technicalities of the processes employed in the manufacture of finished leather by the department fully conversant with this branch of trade and in the context of the provisions of this very statute, the terms of the statute can well be construed by reference to such exposition, in the absence of anything in the statute to indicate the contrary. Indeed, "such interpretation should be shown to be clearly wrong before it is overturned".
29. Nevertheless, the stand of TRAI has been consistent that FSPs cannot use MSC for providing limited mobility in WLL platform.
30. Irrespective of the objections of the Union of India and FSPs that letters or directions of the authority after 8.1.2001 do not form part of the recommendations, Central Government nevertheless imposed conditions as to how the system was to be engineered by the FSPs in WLL (M) platform. We again reproduce the relevant clause:
'The system shall be engineered to be connected to the telephone exchange of Short Distance Charging Area (SDCA) on Access Network Protocol based on National Standards for V5.2 as prescribed by Telecom Engineering Centre (TEC) or an approved improved version with latest technology'."
31. The dispute is what does the expression "approved improved version with latest technology" would mean? Does this expression go with the access network protocol? I do not think so. We have to interpret this clause in a pragmatic manner considering the background as to how limited mobility was allowed in WLL platform to BSOs and what TRAI said about its recommendations which were accepted by the Central Government. We have to give meaning to each word in the clause. What would be the word "improved" mean? It has only to go with V5.2. Earlier it was V5.1 interface and which after technology advancement now V5.2 is its improved version. If the Central Government wanted MSC there was no difficulty in using that term. It was not an unknown term. It was mentioned by the TRAI in its recommendations and was well known. Any march of technology has to be after the issue of guidelines amending the term of the licence. The expression "approved improved version with latest technology" would certainly not mean MSC which was already well known. The background note in the Consultation Paper issued by the Authority on 3.11.2001 the interface V5.2 is specifically mentioned. It says: " A number of alternatives to copper based Local Loop have emerged under the generic name of 'Wireless in Local Loop (WLL)'. WLL systems are applications of Cellular technology (either Micro or Macro) to connect a Fixed telephone set to the exchange through an open interface (V5.2) as indicated in the diagram at Annexure A". It is not necessary to reproduce the diagram. We were not told which FSP is using V5.2 interface in WLL (M) platform.
32. At the outset in the beginning of the arguments it was submitted by Mr. Vahanvati that his objection was to the use MSC by the FSPs. There are, however, multiple reliefs claimed in the petition in the prayer clause but Mr. Vahanvati confined his arguments to prayer (a) which is as under:
"(a) direct the DoT and the TRAI to ensure that all the Fixed Service Providers fully comply with each and all terms and conditions of their licenses as also all other applicable recommendations, orders, permissions, determinations etc. of TRAI and DoT, including in particular:
(i) that FSPs should use only Access Network protocol based on National Standards for V5.2 as prescribed by Telecom Engineering Centre or an approved improved version only with PSTN architecture for providing WLL (M) Services;
(ii) that FSPs do not use Mobile Switching Centre and prohibit them from using Mobile Switching Centre for providing WLL (M) Services;
(iii) That FSPs should offer and provide WLL(M) Services to their subscribers only within the SDCA in which the Subscriber is registered and prohibit FSPs from providing the said services beyond respective SDCAs and that FPSs do not hand over calls from one SDCA to another SDCA;
(iv) that FSP's should forthwith cease to provide WLL (M) Services unless and until they fully comply with all applicable terms, conditions and mandates of the DoT, TRAI and their licenses/permission/restrictions etc.;
33. After the close of the arguments we sent for the relevant files of the Department. The counter affidavit by the DoT was filed after it was approved by the Solicitor General. It runs into 10 pages. There is no mention even of the word MSC. Even the notings in the file do not mention MSC. After the recommendations of the TRAI dated 8.1.2001 were accepted by the Central Government guidelines were issued on 25.1.2001 and at the same time letter dated 25.1.2001 was issued to the existing BSOs. Again no mention of MSC. During the course of arguments to a specific query it was submitted by learned ASG that Government did agree to use of MSC by the BSOs. ASG must have made this submission on the basis of instructions received which may not be necessarily in writing. However, we expected that when such a serious contentious matter is pending before us there would have been some noting in the file permitting the BSOs use of MSC. We did not find any such noting. This shift in the stand of the Central Government to that of its earlier stand of steadied silence on the use of MSC in the counter affidavit is not understood. It was a known fact that FSPs were exploiting virtual roaming and multiple registration (when a subscriber can get almost full benefit of roaming and is not confined to one SDCA) for their subscribers by use of MSC in breach of terms of the licence and in spite of complaints coming from CMSPs and attention drawn by the Authority to the breach of its recommendations and terms of the licence, the DoT looked the other way and rather expressed annoyance and that is how, it would appear, letter dated 17.10.2001 was written by the Secretary, DOT to the Chairman, TRAI. Nevertheless TRAI stuck to its stand.
34. Mobile Switching Centre (MSC) allows service provider to offer roaming and virtually unlimited mobility. In fact, it is the mainstay and structure of a fully mobile service. While V5.2 interface restricts mobility to a SDCA (Short Distance Charging Area). It is submitted by Union of India and FSPs that MSC represents the "march of technology". The term "march of technology" cannot be advanced to deflect real issue. As said earlier, MSC is not a new technological development and was even used by FSPs for providing WLL (fixed) even before 25.1.2001. MSC could not have been used in the licence of FSPs when they were allowed limited mobility in WLL platform and when the condition of the licence allowed the use of only V5.2 interface or approved improved version with latest technology. MSC cannot said to be approved improved version with latest technology for the condition in the licence to become applicable. Before amendment to the licence of FSPs allowing mobility in WLL platform, FSPs had put up towers and offered subscribers fixed phones at home with antenna to pick and transmit signals through the air. Now while the contention of CMSPs is that when the Government allowed limited mobility within the SDCA this did not permit FSPs who were earlier not allowed limited mobility, to replace fixed exchange i.e. PSTN with the mobile exchange (MSC). Let us understand the problem in this way. A phone which is fixed at home or at a certain place is connected by copper/fibre cable to a junction box and then to PSTN (Public Switched Telephone Network) exchange. Under the original licence for FSPs which allowed WLL (Fixed) a phone has to have an antenna which should be connected by wireless to towers which in turn will transmit signals to Basic Station Controller (BSC) which is like a junction box and then connected to PSTN, a fixed exchange. FSPs, however, contend that after they were allowed limited mobility transmission is now from mobile phone to towers, towers to Base Station Controller and then to MSC. We have noted above that MSC allows seamless handover of calls, traces subscribers movement from one area to another and one city to another. If instead of MSC, it is V5.2 interface the mobility is restricted to Short Distance Charging Area and it is connected to PSTN fixed exchange. It is the submission of FSPs that they have already installed MSC and further if interface is restricted to V5.2 they will have to spend substantial amount of money for constructing more towers and Base Station ControlleRs. That FSPs (who were now allowed limited mobility) cannot be heard to say that they would have to incur huge cost if they are restricted to V5.2 interface.
35. I do not think we have to consider the principle of ejusdem generis to interpret the clause set out in the beginning of the order and which principle I do not think is quite applicable in the present case. No counsel has raised this issue either.
36. The argument that MSC was being used by FSPs earlier to 25.1.2001 has no meaning inasmuch as licensor could have permitted the use of MSC for WLL (fixed). During the pendency of this petition applications were filed by the petitioners drawing the attention of the Tribunal to the fact that FSPs were contravening the conditions for grant of limited mobility in WLL platform, while the petition was being adjourned from time to time due to pendency of the appeal in Supreme Court against the earlier order made by the Tribunal in Petition No. 1 of 2001. By order dated 18.3.2002 this Tribunal directed that "in the meantime, there will be an order of status quo as of date till the final disposal of the petition". If in spite of this order any MSCs have been installed, it would be in breach of the order and no advantage can also be drawn from the same.
37. During the course of arguments learned Additional Solicitor General said that both V5.2 and MSC were capable of both limited and unlimited mobility, if certain specifications are laid down under which it will not be possible to engineer use of unlimited mobility. We put it to him as to what precaution were taken by the Central Government while laying down technical details, to ensure that these were not misused and whether the Government took any action to ensure that any software was being put in the Access Network Protocol to keep limited mobility confined to SDCA and there is no handover of the calls. We put it to him that it was extensively reported that FSPs were allowing to their subscribers virtual roaming by multiple registration and handover of calls and what precautions or the action the Government took so that guidelines allowing limited mobility and the licence conditions of FSPs are adhered to. In reply, learned ASG said that there was a software which put stop on handover calls from one SDCA to another, but he said that he was not sure as to what specific action had been taken and said that he would file written statement in that regard. Nothing was, however, done. Knowing fully well that the terms of the licence are flagrantly breached in large scale by FSPs, DoT took no action and that would rather point to its complicity in granting undue advantage to FSPs. It appears DoT was under some pressure group which tied its hands from taking any action. We are unable to find any other explanation. In all fairness, Mr. Dipankar Gupta, learned senior advocate for Tata Teleservices submitted that his client was not doing any multiple registration. No such statement was forthcoming from Reliance Infocomm Ltd. and other FSPs.
38. It is the question of interpretation of the provisions of the licence which to my mind allow FSPs only V5.2 interface or an approved improved version thereof with latest technology. As per the recommendation of TRAI it has to be PSTN structure by FSPs and not PLMN.
39. PSTN (Public Switched Telephone Network) and PLMN (Public Land Mobile Network) have been defined and used in the licence document and are well understood. In the licence document PLMN has been defined. It means a network, established and operated by Department of Telecom or its licensed operator(s), for the specific purpose of providing land mobile communication services to the public and it provides communication possibilities for mobile users though for communication between mobile and fixed users interworking with a fixed network is necessary. When such a definition of PLMN is given in the licence document itself it is not proper for us to refer to any other definition. One should not fish out some definition from internet and use it for the purpose of arguments though that definition may be by the highest authority in a foreign land. Intention to make use of such a definition in support of the argument may be good but certainly not desirable.
40. I did not feel it necessary to record the arguments of learned counsel for the parties which were quite profound and other facts as these have been extensively set out in the order of the learned Members of the Tribunal. I may add that when a judicial authority finds some wrong has been committed it has to be set right irrespective of the consequences flowing therefrom or the cost incurred by the party in the wrong.
41. Accordingly, I would allow the petition in terms of prayer (a).