HC upholds Trai’s Re1 compensation for call drops

The Delhi High Court on Monday upheld the decision by the Telecom Regulatory Authority of India making it mandatory for cellular phone operators to compensate customers for dropped calls, an order which was opposed tooth and nail by the telcos.

A bench of Chief Justice G Rohini and Justice Jayant Nath dismissed a batch of petitions from telecom operators for a stay on Trai's compensation policy announced last year, under which a rupee will be credited to a mobile user's account for every call drop up to three a day from 1 January 2016.

''There is no dispute about the power of Trai to make regulation under section 36 of the Act,'' the bench observed. ''The impugned regulation has been made in exercise of the power conferred under the Act, keeping in mind the paramount interest of the consumer.''

The petitioners had termed the directive ''arbitrary and whimsical'' while arguing that providing compensation to consumers amounted to interfering with the companies' tariff structure and this could be done only by an order and not a regulation.

India is the world's second-largest mobile user market after China, but fast-paced expansion coupled with inadequate infrastructure and overloaded networks is leading to a slew of dropped calls every second across the country.

Trai told the court that consumers have a right to get compensated for call drops and this was different from the quality of service guidelines that cellular service providers have to follow under the licence conditions.

The judges said that under ''no circumstances'' the telecom regulator's decision can be ''termed as penalty''.

Trai said the policy was created after consumers began experiencing regular call drops. In the first quarter of 2015, about 25,787 crore outgoing calls were made, of which in 200 crore cases call drops were encountered by consumers.