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CAG says DoT supervision ‘ineffective and weak’

4 Aug 2014

The Comptroller and Auditor General (CAG) has said in a report that seven operators have not paid penalties totalling INR21.17 billion (USD346.99 million) relating to non-compliance with subscriber verification rules. The Economic Times writes that CAG has claimed that operators had only paid INR3.899 billion of a total INR25.068 billion levied against them, with INR5.95 billion still owed by Reliance Communication (RCOM), whilst Bharti Airtel is yet to pay INR5.03 billion, Aircel INR4.02 billion, Bharat Sanchar Nigam Ltd (BSNL) INR2.69 billion, Vodafone INR2.03 billion, Idea Cellular INR741.5 million and Tata Teleservices (TTSL) INR704.7 million. The fees relate to a penalty levied on cellcos for filing incorrect Customer Application Forms (CAFs) for mobile services between 2009 and 2012. For every incorrect CAF, operators are charged a fine which increases depending on the proportion of wrong forms submitted. If more than 95% are correct, the fine is INR1,000, increasing to INR5,000 if the proportion is 90%-95%, up to a potential INR50,000 if less than 80% are correct.

Further, the CAG report says that the Department of Telecommunications (DoT) undercharged the cellcos, by a substantial margin: ‘Total defective CAFS for the seven major service providers was 4.2 crore [42 million] for the year 2012. Even if a minimum penalty of INR1,000 is levied for each defective CAF, the total penalty works out to be INR42.04 billion for the year 2012 alone.’ The comptroller went on to accuse the DoT of ‘ineffective monitoring and weak control’, noting that regular monthly audits were insufficient on their own, as surprise checks had revealed much greater levels of non-compliance.

As noted by TeleGeography’s GlobalComms Database, the DoT has come under greater pressure and scrutiny from other government agencies in the wake of the 2G spectrum scam – which resulted in the termination of 122 licences that had been awarded illegally – hindering the regulator’s efforts to function effectively. With the likes of the CAG breathing down their necks, DoT officials have been reluctant to make decisions without first undertaking time consuming and often irrelevant legal consultations, lest they face persecution for their action in the future.

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