Airtel to file suit against India govt's $108M penalty

Bharti Airtel has slammed a US$108.3 million (6.5 billion rupees) fine issued by India's Department of Telecoms (DoT), for a service which only generated thousands of dollars in revenue. 

In a statement released today, the country's biggest telco said it was "shocked and disappointed" to receive the demand notice for the subscriber local dialling (SLD) service which was offered between 2002 and 2005. It refers to a service where all calls are delivered as local calls, even if they originate from outside the local coverage area.

"Strangely, without as much as giving us a proper hearing, the DoT after eight years has issued a demand notice of Rs. 650 crore in complete disregard of the natural process of justice," Airtel said in the statement.

In 2003, the telecom department ordered the carrier to stop using SLD to route national and international calls as local calls, according to a report Thursday by Livemint. However, Airtel continued the practice until 2005, causing losses to  state-run telco BSNL.

Airtel said the regulator had found the SLD to be fully compliant with license conditions. It said it will initiate legal action against the order.

"We urge the DoT to set out a cogent policy on imposition of penalties so that telecom companies can operate in a rational and transparent environment," it noted.