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Cellular Operators Association of India & Ors. v. Telecom Regulatory Authority of India & Ors.

Civil Appeal · Neutral citation not assigned (Civil Appeal No. 1563 of 2007)Decided 30 Jan 2015
Civil Appeal No. 1563 of 2007
Justice Sudhansu Jyoti Mukhopadhaya · Justice Prafulla C. Pant

Background

Private GSM mobile operators and their industry association challenged a directive of the Telecom Regulatory Authority of India (TRAI) that required them to stop charging different (higher) tariffs for calls terminating on BSNL/MTNL's network compared to calls terminating on another private operator's network in four states. The operators argued the two types of calls were technically different (direct connectivity vs. indirect) and so could lawfully be charged differently, while TRAI said charging different rates to the same class of subscribers for calls to the same destination was discriminatory. The Telecom Disputes Settlement & Appellate Tribunal rejected the operators' appeal, leading to this further appeal to the Supreme Court.

Decision Breakdown

The Supreme Court upheld the Tribunal's reasoning, holding that subscribers making calls to the same type of destination network form "the same class" of consumers regardless of the technical routing difference the operators relied on, and that charging them differently is impermissible discrimination under the Telecommunication Tariff Order. Applying the twin-test for reasonable classification from State of West Bengal v. Anwar Ali Sarkar, the Court found the operators' distinction between calls to other private networks versus calls to BSNL/MTNL arbitrary and unjustified. The appeal was accordingly dismissed with no order as to costs.

Lesson Learnt

A service provider cannot justify charging different prices to similarly situated customers merely by pointing to internal technical or routing differences that have no bearing on the service the customer actually receives: regulatory bodies can strike down such differential pricing as unlawful discrimination.

Official source (sci.gov.in)View Judgment (PDF)

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