B.S.N.L versus RELIANCE COMMUNICATION LTD.

B.S.N.L versus RELIANCE COMMUNICATION LTD.

Clause 6.4.6 of the Interconnect Agreement is not penal but a pre-estimate of reasonable compensation for loss foreseen at contract inception. It prescribes compensation for wrongly routed or masked calls, and restricts the charge to the preceding two months, as a 'rough and ready measure,' supporting the finding of liquidated damages and not penalty. The clause operates within the regulatory framework to maintain a level playing field among operators and compensate BSNL for loss caused by unauthorized routing or masking of international calls.

Parties
Appellant: B.S.N.L.; Respondent: Reliance Communication Ltd.
Jurisdiction
India
Judgment Date
29 November 2010
Procedural Posture
Civil Appeal / Appeal From Tribunal Decision
Outcome
Appeal allowed
Legal Topics
Interconnect Agreement, Liquidated Damages Vs Penalty, Compensation for Wrongly Routed Calls, Regulatory Regime in Telecom
Telecommunications Contract Law Interconnect Agreement Liquidated Damages Vs Penalty Compensation for Wrongly Routed Calls Regulatory Regime in Telecom

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Parties

B.S.N.L.

Appellant

Reliance Communication Ltd.

Respondent

Procedural Posture

Civil Appeal / Appeal From Tribunal Decision

Legal Issues

  1. 1 Whether clause 6.4.6 of the Interconnect Agreement is penal or constitutes a pre-estimate of damages
  2. 2 Obligations of Unified Access Service Licence holders under Interconnect Agreement
  3. 3 Interpretation of 'wrongly routed calls' and levy of charges/penalty

Ratio Decidendi

Clause 6.4.6 of the Interconnect Agreement is not penal but a pre-estimate of reasonable compensation for loss foreseen at contract inception. It prescribes compensation for wrongly routed or masked calls, and restricts the charge to the preceding two months, as a 'rough and ready measure,' supporting the finding of liquidated damages and not penalty. The clause operates within the regulatory framework to maintain a level playing field among operators and compensate BSNL for loss caused by unauthorized routing or masking of international calls.

Court Disposition

Appeal allowed

Orders

  • Impugned judgment of Tribunal set aside
  • Matter remitted to the Tribunal (TDSAT) to decide de novo in accordance with law laid down herein