Rural telecom shutdown costs ADAG firms Rs 5.59 cr in penalty | india | Hindustan Times
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Rural telecom shutdown costs ADAG firms Rs 5.59 cr in penalty

The government today said two Anil Ambani companies have been fined a total of Rs 5.49 crore for shutting down rural telephone services during 2010-11, in violation of the USOF agreement.

india Updated: Aug 03, 2011 16:05 IST

The government on Wednesday said two Anil Ambani companies have been fined a total of Rs 5.49 crore for shutting down rural telephone services during 2010-11, in violation of the USOF agreement.

"Reliance Communications Ltd and Reliance Telecom Ltd have been fined Rs 4.42 crore and Rs 1.06 crore respectively, for shutting down rural telephony services during 2010-11," minister of state for communications and IT Milind Deora told the Lok Sabha in a written reply.

In 2007, a scheme was launched under the Universal Service Obligation Fund (USOF) to provide subsidy support for setting up and managing 7,871 infrastructure sites (telecom towers) in 500 districts, in specified rural and remote areas.

However, the minister said the company had cited commercial inviability as the reason for shutting down these services.

Telecom companies, Bharti Airtel, BSNL, Aircel, Idea Cellular, Reliance and Vodafone also participated in the scheme.

Deora said the government has not slashed the fine imposed on the two ADAG companies. He said in view of the switch off and subsequent switch on of the services, the fine/penalty has been imposed for the period of interruption in mobile services as per the provision contained under the USOF agreement with these companies.

Apart from the above actions, under the USOF agreement with these companies, the department has also constituted a high level committee to consider all aspects of the issue and suggest appropriate further action, if necessary, under the Unified Access Service Licence condition, he said.

As per the agreement no penalty shall be payable in case of interruption of mobile services for a period of upto seven days in a quarter. It says penalty at Rs 5 per day shall be payable if there is interruption in services for more than seven days in a quarter.

However, if there is interruption in services for 45 days or more in a quarter, penalty shall be payable for the whole quarter, the agreement said.

Recently, telecom minister Kapil Sibal had set up a panel to ascertain the reasons for delays in providing mobile services in rural areas under the USOF scheme.