Differential tariffs over subscribers making calls from one private provider to other private service provider and from private network to BSNL/MTNL held arbitrary

Supreme Court: While deciding that whether the Telecom Disputes Settlement and Appellate Tribunal was right in terming the action of the private telecom service providers (forming the appellant association) for levying differential tariffs for calls made from their network to the BSNL/MTNL networks compared to the calls made from one private telecom service provider to the other, as discriminatory, the Court upheld the decision of the Tribunal and stated that such classification of subscribers into two categories on the basis of calls made by them from private network to another private network and from private network to BSNL/MTNL network is arbitrary and fails to satisfy the test for reasonable classification laid down in State of West Bengal v. Anwar Ali Sarkar, AIR 1952 SC 75.

In the instant case, the appellant raised questions at the directive issued by the Telecom Regulatory Authority of India (TRAI) wherein they were directed to discontinue differential tariffs levied in the  States of Maharashtra, West Bengal, Tamil Nadu and Uttar Pradesh for calls to the network of BSNL and MTNL as compared to calls terminating in the network of other private operators as it was discriminatory and inconsistent with the amended licence condition notified by the Department of Telecommunication. The counsel for the appellant Navin Chawla contended that prescribing differential tariffs does not violate Article 14 of the Constitution as the similarity of the class has to be decided on basis of similarity of the features of its constituents and the costs involved in the nature of the calls are different. Mohit Paul on behalf of the respondent argued that private GSM providers were duty bound to arrange leased lines to establish direct connection to the BSNL/MTNL networks as they had done amongst each other.

The Court on perusing the arguments and the factual situation, observed that TRAI in its Telecommunication Tariff Order, 1999 which is subject to periodical amendments, had inserted a ‘non-discrimination clause’ prohibiting the service providers to discriminate between the subscribers in matter of application of tariffs, but the issue was  whether the clause is applicable to the  subscribers making call to another private network from a private network as compared to the class making call from a private network to BSNL/MTNL network, to which the Court answered in positive and upheld the decision of the Tribunal terming the classification of subscribers on the ground that the call ends with the private parties and another on the ground that the call ends with BSNL/MTNL as arbitrary and discriminatory. Cellular Operators Association of India v. Telecom Regulatory Authority of India, 2015 SCC OnLine SC 82, decided on 30.01.2015

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