Bombay HC backs IUC cut, no interim relief for Airtel, Idea

The Bombay High Court on Friday refused to stay the Telecom Regulatory Authority of India's (TRAI) order on the reduction of interconnect usage charges (IUC) to 6 paise from 14 paise that was challenged by incumbent operators Bharti Airtel and Idea Cellular.

The court said that it will hear the case in detail after the vacation period and so the settlement of the case will only happen in November.

The two telecom companies, Bharti Airtel and Idea Cellular, argued that the current IUC charge of 14 paise is very important for them to recover the infrastructure cost. They use the collections to set up the infrastructure to receive the incoming calls on their network.

TRAI had on September 19 cut termination charge for all mobile to mobile calls to 6 paise per minute from 14 paise. The revised charge, effective October 1, will be reduced to zero from January 1, 2020. For calls between landlines, between mobiles and landlines and vice versa, this charge will continue to be nil.

TRAI said that it is very important that the court should not put any interim relief or stay on this particular case as it is very crucial for the revised IUC charge of 6 paise to kick in from October 1 when the billing cycle starts.

In addition, TRAI does not expect it to have any material impact on the balance sheet of these telecom operators.

Nevertheless, high court's refusal of the interim stay is not the end of the road for this particular case. Bharti Airtel and Idea Cellular still have an option of challenging this refusal in the Supreme court.

In another development in the telecom sector, the telecom commission has approved the extension of deferred spectrum payment to 16 years, thereby, giving telecom firms more time to make their spectrum payments.