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An Overview of a Flawed Act
by Meet Malhotra*

Cite as : (2005) PL August (J) 14

The provisions of the Telecom Regulatory Authority of India Act, 1997, ("the Act") are in reality, fetters to and not catalysts for regulation of telecommunication services in India. As the title and preamble of the Act would suggest, the main function of the Authority is to regulate the telecommunication services and matters connected therewith and incidental thereto. However, the word "regulate" has not been defined in the Act. The ordinary meaning of the word "regulate" has connotations of "control by rule or restriction". This meaning has been recognised in a number of judicial pronouncements. An element of restriction or restraint so also the power to intervene is inherent and central to regulatory measures. On both counts, the TRAI Act is lacking.

Under Section 11(1)(b) of the Act, the Authority is required to ensure compliance with provisions of licence, interconnection arrangements, quality of service and universal service obligations, etc.

The means to "ensure" such compliance are given in Section 13 which gives limited power to the Authority to issue directions to service providers for discharge of its functions under Section 11(1)(b) only. Theoretically, if the Authority seeks information from any service providers in order to enable it to make a recommendation under Section 11(1)(a) of the Act, and the service provider refuses to furnish the information, the Authority can do little about it. If a broadcaster, a multi service operator or a cable service operator flouts a tariff order issued under Section 11(2) the Authority can do nothing at all. In the case of telecom service providers, compliance with the tariff orders of the Authority can be indirectly ensured because compliance with tariff orders of the Authority is part of the licence issued to the telecom service providers under Section 4 of the Telegraph Act, 1885, and the Authority is competent to issue directions to ensure the compliance with terms and conditions of that licence. However, as cable television service providers are not licensed at all, no direction can be issued by the Authority to such service providers if they fail to comply with the tariff order of the Authority. This is a serious and grave shortcoming in the Act, which adversely effects the regulatory functions of the Authority.

Where the service provider refuses to comply with such direction of the Authority, all that the Authority can do is to issue the service provider a show-cause notice, grant a hearing to the service provider and come to a decision that the service provider needs to be prosecuted under Section 29 of the Act. Even such decision is an appealable decision. The Authority can enforce its orders only after a period of 30 days from the date of the order i.e. after waiting out the period provided for under the Act for the service provider to prefer an appeal against such direction of the Authority.

Even the limited power of intervention available to the Authority under the Act is subject to appeal before the Appellate Tribunal under Section 14(b).

In my opinion, the Authority could be given effective powers to regulate only if it was revested with its powers to settle disputes between service providers and was also conferred powers to impose penalties on service providers who fail to comply with its orders, directions and regulations. All regulatory and dispute settling powers of the Authority may and should be subject to the jurisdiction of the Appellate Tribunal. In fact, in such a scenario, the appellate functions of the Tribunal may be clarified and enhanced.

The Act has been drafted and amended in great haste. So very carelessly has the Act been "amended" on 24-1-2000 that Section 33 of the amended Act still refers to the powers of the Authority under the unamended Act. Telecommunication is far too important a sector to be left to be regulated by such a seriously flawed Act.


  • * Advocate, New Delhi. Return to Text
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