Holding

The 'Walky' service falls within the WLL(M) category, making the appellant liable to pay ADC for the relevant period, and the TRAI circular is merely clarificatory, not amendatory.

Summary

BSNL demanded Access Deficit Charges (ADC) from Tata Teleservices for its 'Walky' service for the period 14‑Nov‑2004 to 26‑Aug‑2005, alleging that the service should be classified as Wireless Local Loop Mobile (WLL(M)) and thus liable to ADC. Tata contended that 'Walky' was a fixed wireless (WLL(F)) portable device and that the TRAI circular of 4‑Mar‑2005 unilaterally re‑classified it without authority, rendering the ADC demand illegal. The Supreme Court examined the nature of the service, the definitions in the Unified Access Service (UAS) licence, and the status of the TRAI circular, concluding that the circular merely clarified existing licence provisions and did not amend them. It held that the mobility of the Walky device placed it within the limited‑mobility category (WLL(M)), disturbing the integrity of the numbering plan, and therefore ADC was payable. The Court also found no unilateralism in BSNL’s demand, as the TRAI directive was issued in accordance with the 1997 Act. Consequently, the appeals were dismissed.

Issues considered

The correct classification of the 'Walky' service: WLL(M) versus WLL(F).
Whether the TRAI circular dated 4‑Mar‑2005 is clarificatory or amendatory of the licence terms.
Whether BSNL could unilaterally impose ADC liability on the appellant.
Whether ADC is payable for the period 14‑Nov‑2004 to 26‑Aug‑2005.
Whether the TRAI directive can be applied retrospectively.

Legislation cited

Telecom Regulatory Authority of India Act, 1997s. 11, s. 13

Subjects

Access Deficit ChargesADCWLL(M)WLL(F)WalkyTelecom Regulatory Authority of IndiaTRAI circularPremises Specific RestrictionLimited MobilityFixed Wireless AccessUnified Access Service LicenceUnilateralism

Judgment

[2008] 7 S.C.R. 308

y
A TATA TELESERVICES LTD.
V.
BHARAT SANCHAR NIGAM LTD. AND ORS.
(Civil Appeal No. 5850 of 2005 etc.)

APRIL 30, 2008
8
[S.H. KAPADIA AND B. SUDERSHAN REDDY, JJ.]

Telecommunication Interconnection Usage Charges
Regulation 2003- Access Deficit Charges (ADC)- Levy of -
c On the services which fall in the category of WLL(M) - Levy
on the services provided under 'Walky' treating the same as
WLL{M) - Pursuant to Circular by TRAI directing service
providers to comply with Premises Specific Restrictions (PSR)
and the directives issued by Department of
D Telecommunication (Do T) - Challenged on the ground that
the service in question has been reclassified by the Circular
of TRAI, altering the terms and conditions of the Licence under
which the service was taken; and that classification was without
authority and unilateral - Held: The services under 'Walky'
having limited mobility falls in the category of WLL(M) service
E -The service providers were providing WLL(M) services
during the relevant period in the garb of FWA WLL{F)- Hence,
Access Deficit Charges (ADC) is leviable for the relevant
period- The Circular issued by TRAI is clarificatory and not
amendatory- It has not reclassified 'Wa/ky' as WLL(M) for thf!
F first time and thus does not alter the terms and conditions of
the Unified Access Service (UAS) Licence- It was issued in
accordance with law - In view of the technology aspect and
policy framework for levy of ADC, there is no uni/ateralism-
Telecom Regulatory Authority of India Act, 1997- ss. 11 and 13.
G
Respondent (BSNL) demanded Access Deficit
Charges (ADC) from the appellant for the period ,_
14.11.2004 to 26.8.05 in respect of its service provided
under its brand name 'Walky'. Appellant opposed the

HI 308
TATA TELESERVICES LTD. v. BHARAT SANCHAR 309

-- '(
NIGAM LTD. AND ORS.

demand on the ground that 'Walky' is a fixed wireless A
phone WWL(F), having portability as its feature and hence
could not be classified as WWL(M). Appellant raised the
dispute before Telecom Disputes Settlement and
Appellate Tribunal wherein it was held that 'Walky' calls
~ attracted ADC under the regulatory regime. Hence the B
present appeal.
Appellant contended interalia that the respondent had
no authority to impose ADC liability unilaterally on the
appellants by classifying the instrument as a mobile
phone; that the demand was misconceived as the dispute c
regarding its classification was subjudice before the
authority; that 'Walky' as an instrument is portable, not
mobile and therefore could not be classified as WWL(M);
that Telecom Regulatory Authority of India (TRAI) by the
-( Circular dated 4.3.2003 has reclassified 'Walky' as WLL(M) D
j.
'\ and thereby has amended the terms and conditions of
UAS Licence and Telecommunication Interconnection
~
' Usage Charges Regulation 2003 (IUC Regulations).
Respondent-BSNL contended interalia that there
was no unilateralism in the demand made by BSNL, as E
the same was made only after the TRAI and the
Department of Technology (DoT) had issued the Circular
dated 4.3.2003 and Directives dated 23.3.2005 and
". 26.8.2005, respectively; that compliance of the Order/
~· > .... Directive of DoT dated 26.8.2005 by the appellant, F
indicates that even according to the appellants, ADC was
payable in respect of the service, i.e., WLL(M) and,
therefore, it was not correct to say that ADC could not be
charged without change in the conditions of licence or
2003 Regulations. G

-> Dismissing the appeals, the Court
HELD 1.1 The services of the appellants vide the
instrument 'Walky' falls in the category of WLL(M) service
and, accordingly, the appellants would be liable to pay H
310 SUPREME COURT REPORTS [2008] 7 S.C.R.
y ~

A Access Deficit Charges (ADC) in that regard during the
relevant period ie. 14.11.2004 to 26.8.2005. [Para 49]
[364-A, B] ........
1.2 Directive dated 4.3.2005 by Telecom Regulatory
i'<•.r•
Authority of India (TRAI) was issued to all access )-
B providers. The said directive came to be issued as it was
brought to the notice of TRAI that new terminals were
being deployed by access providers which terminals do
not have any fixed network access point physically located
at the address of the subscriber. In the said Circular, TRAI
c noted that fixed wireless services were required to be
provided through fixed wireless terminals with the
location of the network access point being fixed and with
the end-user terminal being connected to it. That, it had
been brought to the notice of TRAI that new terminals were
·D being deployed by certain access providers which did not
possess fixed network access point physically located :4 ,. .
in the premises of the subscriber. Therefore, by the said
Circular, TRAI directed the service providers to strictly •
ensure that the terminal used for fixed wireless services
E should strictly comply with premises specification
restriction, i.e., to the premises of the subscriber. The
Circular dated 4.3.2005 stood followed by letters from DoT
dated 23.3.2005 and 26.8.2005. [Para 38] [356-F, G; 357-A-D]
1.3 The Circular dated 4.3.2005 issued by TRAI is
F clarificatory and not amendatory. In the Circular, TRAI has
"" ...
used certain technological terms generally used in
telecommunications like 'network access point', 'end-user
terminal' and 'fixed network access point'. These terms
find place in the generic requirement formulated as far
G back as 1996. They also find place in the Principles of ""·I''
£,

Wireless Access formulated by ITU-RCA. Keeping in mind ,_
,.,
the definitions given both in the technical references as
well as in the principles of wireless access formulated by
ITU-RCA, it is clear that Premises Specific Restriction
H ("PSR") is not something new which stood evolved for
TATA TELESERVICES LTD. v. BHARAT SANCHAR 311
NIGAM LTD. AND ORS.

the first time by Circular dated 4.3.2005. In substance, PSR A
emanates from concepts, which are well known in
telecommunications, both in technological references as
well as in terms of generic requirements and in terms of
principles of wireless access. [Paras 39 and 40] [357-D-
H; 358-A, B] B
1.4 Broadly FWA is called WLL(F). The UAS Licence
refers to three types of wireless services, namely, full
mobility, limited mobility and FWA. As stated, in FWA, the
location of the end-user (Walky) and the network access
point (antenna connected to the end-user) are both fixed C
whereas in the case of mobile wireless access, the
location of the end-user is mobile. WLL(M) is a hybrid
between FWA and MWA. Wireless access may be
considered from many perspectives. [Para 40] [358-B, C]

; .!._
1.5 The main purpose of FWA [WLL(F))] is to provide D
network access to buildings through exterior antennas
communicating with Central Radio Base Stations. In FWA,
users in a building are allowed to connect to the network
with conventional in-built networks. FWA is a service. It is
intended as a cheap cable replacement, without additional E
features. Wireless systems differ depending upon the
amount of mobility that they allow for the users. FWA
.... system is a derivative of cordless phones. In FWA there is
no mobility of the user devices. This is where the concept/
principle of PSR emerges. There is a difference between F
mobility and portability. A terminal may be portable but
every portable device is not mobile. The concepts
mentioned in Circular dated 4.3.2005 issued by TRAI exist
in telecommunications right from 2001. The said Circular
merely clarifies and brings out the concept Premises
Specific Restriction (PSR). [Para 40] [358-D, E, F, G] G
-· by
1.6 Classification is done by UAS Licence followed
chargeability under Telecommu.nication
Interconnection Usage Charges Regulation 2003 (IUC
Regulations). Therefore, it would be wrong to say that vide H
312 SUPREME COURT REPORTS [2008] 7 S.C.R.
.,,
. ...
A Circular dated 4.3.2005 'Walky' has been reclassified as
WLL(M) for the first time by TRAI. If the concept of FWA
[WLL.(F)] embodies PSR and that too from 2003 then it is
clear that the said Circular dated 4.3.2005 is clarificator1.
It does not alter the terms and conditions of the licence.
B FWA is one of the wireless services contemplated by
UAS Licence which is dated July, 2003, therefore, much
prior to circular dated 4.3.2005 these concepts were
known to all access providers right from 2003. [Para 42]
[359-C, D, E]
c 1.7 ADC is a levy. Its levy depends on mobility as a
service feature. The numbering plan, radio frequency etc.
are all important elements of a network. The numbering
levels for fixed wireless services and for WLL(M) services
are different. So also the numbering levels for fixed
D wireless service, limited mobility service and full mobility
service are different. The identification of the call whether ;
~ '
originating from mobile or from 'Walky' or FWA has a
correlation with the numbering plan which is an important
element of the network of the appellant in its MSC. For
E levy of ADC, integrity of numbering plan is very important.
[Para 43] [359-F-H; 360-A]
1.8 In the present case, TRAI has detected that the
'!"'"
appellant is providing WLL(M) service in the garb of fixed
wireless phone service (FWA) which disturbs the integrity
F of the numbering plan. In the case of full mobility, the rate
~
is different as compared to the rate in the case of limited
mobility as compared to the rate in fixed wireless service.
This difference in the rates is spelt out in IUC Regulation,
2003. It is for this reason that even in the clarification
G issued by DoT on 23.3.2005, the access providers were
warned by pointing out that the issue of mobility has
implication with respect to the applicability of ADC. It was <-

further clarified that if it is not possible for the access
provider to comply with the requirement of PSR then the
H 'Walky' services shall be treated as WLL(M) service for all
TATA TELESERVICES LTD. v. BHARAT SANCHAR 313
NIGAM LTD. AND ORS .
._,
purposes including numbering plan, interconnection A
usage charges, ADC etc. This is because a separate level
with allocated short distance charging area based link
numbering is to be used for wireline and fixed wireless
services. [Para 43] [360-A, B, C, D]
1.9 The record indicates that right from 2003, when B
UAS Licence stood issued, the classification was
contemplated by the licensor-DoT when it categorized
wireless service into full mobility, limited mobility and FWA.
ADC, interconnection usage charges etc. follow that
classification. IUC Regulation, 2003 imposes the statutory c
charges based on the classification in the licence. What
is important in this case is that besides technological data,
even as a matter of policy if there is a contract between
DoT and the access provider in terms of LIAS Licence
which provides for three categories, then the levy of ADC D
would depend upon the service which is rendered to the
•· J ~
user by the access provider. In the circumstances, apart
from technology, this case is more on tax policy which
levies ADC on services which fall in the category of
WLL(M). [Para 43] [360-D, E, F, G] E
1.10 Wireless systems differ in the amount of mobility

-, that they have to allow for the users. The ability to move
around while communicating is one of the main features
of wireless communication for the user. However, within
that requirement of mobility, different grades exist; i.e. F
~; -4 Fixed Devices; Nomadic Devices; and Low Mobility.[Para
44] [360-G; 361-A]
1.11 In the licence there are three types of wirelss
services, namely, limited mobility, full mobility and FWA.
G
IUC levies the charge based on this classification. ADC is
a part of IUC. ADC is also levied under IUC Regulation,
2003. In the case of 'Walky', the instrument can be put in
the car, it can be carried throughout SDCA and 'Walky'
calls can originate not only from the subscriber's premises
H
314 SUPREME COURT REPORTS [2008] 7 S.C.R.

A but it can also originate from any point in the SDCA. '/"'

Because of this mobility, it is classifiable in the category
of limited mobility. In the case of FWA [WLL(F)], there is
no mobility of the user device. When there is no such
mobility of the user device, it is similar to all wired
B communications. Therefore, FWA is categorized as
WLL(F). All wired communications can also fall in WLL(F)
for the purposes of levy of ADC. However, since the user
device in the case in hand is mobile throughout SDCA,
the services which the instrument 'Walky' offers has to
c be categorized as WLL(M) service. In the present case,
the appellants were providing WLL(M) services during the
above period in the garb of FWA or fixed wireless phone
services and thereby they have infringed the integrity of
the numbering plan. Therefore, ADC is payable by the
appellants for the aforesaid period, namely, 14.11.2004 to
D
26.8.2005. [Para 45] [361-D-H, 362-A, BJ

' '·
).
1.12 Classification of services stood effected under
UAS Licence 2003. Under the terms and conditions of that
licence, the access providers were required to maintain
E the integrity of the numbering plan. This was one of the
conditions of the licence. Similarly, classification/
'
categorization of wireless services was done under the

F
licence. The categorization constituted the term of the
licence. As a matter of follow-up for the purposes of levy
of certain charges, including ADC, IUC Regulation 2003
stood enacted. Under Section 11 (1 )(b) of Telecom
-....
'

Regulatory Authority of India Act, 1997, the TRAI is ....
empowered to ensure compliance of terms and conditions
of licence and to fix the terms and conditions of inter-
connectivity between the service providers Similarly,
G
under Section 11(1)(c), TRAI is also authorized to levy fees
and other charges at such rates and in respect of such
services as may be determined by regulations. In the ....
present case, the IUC Regulation, 2003 indicates by way
of schedule the rate chargeable for a call originating from
H
TATA TELESERVICES LTD. v. BHARAT SANCHAR 315
NIGAM LTD. AND ORS.
-· "!' mobile to fixed, fixed to fixed, fixed to mobile etc. Under A
Section 13 of the 1997 Act, TRAI is empowered to issue
directions from time to time to the service providers for
the discharge of its functions under Section 11(1) of the
1997 Act. The classification of the three wireless services
was done under the licence. The clarification issued by B
TRAI on 4.3.2005 was under Section 13 of the 1997 Act. In
the circumstances, the said clarification dated 4.3.2005
was issued by TRAI in accordance with law. [Para 46]
[362-B-G]
2. It is not correct to say that when the question c
whether portable WLL(F) Phones should be treated alike
as WLL(M) phones was pending before TRAI- pursuant to
complaints from BSNL dated 4.1.2005, it was not open to
TRAI to issue a directive as is done in this case on 4.3.2005
a
without waiting for determination by the competent D
authority. The directive dated 4.3.2005 is clarificatory and
) ~
not amendatory. In any event, in view of the technology
aspect and policy framework for levy of ADC, there is no
unilateralism as alleged by the appellant. [Para 48] [363-A-D]
CIVIL APPEALLATE JURISDICTION : Civil Appeal No. E
5850 of 2005.
From the final Judgment and Order dated 9.9.2005 of the
Telecom Disputes Settlement and Appellate Tribunal, New Delhi
in Petition No. 45 of 2005. F
.# -.{ WITH
Civil Appeal No. 5871 of 2005.
Gopal Subramanium, Vikas Singh, ASGs, Arun Jaitely,
Romji Srinivasan, K.K. Venugopal, J.J. Bhatt, P.P. Tripathi, G
Rakesh Dwivedi, Dr. A.M. Singhvi, Ruby Singh Ahuja, Manu
Aggrawal, Simran Brar, Jai Singh Brar, Manik Karanjawala,
-· Anjali Chandiyalker, Manali Singhal, K. Raj, Gopal Sankar
Narayan, Abhijat P. Medh, Maninder Singh, Prathibha M. Singh,
Gaurav Sharma, Summeet Bhatia, Surabhi Mehta, Yoginder H
316 SUPREME COURT REPORTS [2008] 7 S.C.R.

A Handoo, Tejveer Bhatia, S.W.A. Qadri, Anil Katiyar, Sanjay Jo-
..
Kapur, Shubhra Kapur. Raj iv Kapur, Arti Singh, Navin Chawla,
Manjul Bajpai, Ritika Chawla, Arun Dhillon, for the appearing
parties

The Judgment of the Court was delivered by
B
KAPADIA, J. The controversy in these civil appeals is:
whether appellant is liable to pay Access Deficit Charges
("ADC") to BSNL for the period commencing from 14.11.2004
to 26.8.2005 in respect of its service provided under its brand
name "WALKY".
c
Introduction:
2. ADC is a levy imposed by TRAI (Regulator) on the
operators (service providers) to support roll out of telephones
in rural areas. Since BSNL owns 99% of the rural phones, ADC
D
constitutes a levy for the appellant and a subsidy for BSNL. The
said ADC has two parts: (i) the component of the payment to be ) t.
made by the domestic service provider, and (ii) the component
of the payment to be made by international long-distance service
providers. The ADC regime was introduced in 2004.
E
3. In March, 1997, Telecom Regulatory Authority of India
("TRAI") Act stood enacted. The Government introduced New
Telecommunication Policy ("NTP") in 1999 and proceeded to
implement the said policy. By TRAI (Amendment) Act, 2000 a
key change came to be effected as a result of NTP, 1999. The
F
said amendment segregated the Regulatory and Dispute
Settlement norms of the original TRAI. Under the new regime, ).- 4.....
all disputes involving consumer and service provider(s) had to
go to TDSAT. The said regime excluded civil courts from ruling
on disputes arising out ofTRAI decisions. TDSATwas conferred
G with original and appellate jurisdictions. The TRAI (Amendment)
Act, 2000 defines precisely the regulatory powers of the TRAI.
The said Regulator became responsible for introduction of new
service providers, technical improvements, quality standards
..
and fixing the terms and conditions of licences. One more event
H needs to be mentioned. In order to separate policy making and
TATA TELESERVICES LTD. v. BHARAT SANCHAR 317
NIGAM LTD. AND ORS. [KAPADIA, J.]
~

service provision roles of the DoT, the Government created A
'"' Department of Telecom Services ("DTS"}, which was later turned
into the corporate entity known as BSNL on 1.10.2000.
4. Under the NTP, 1999, all new cellular mobile service
providers had to pay a fixed fees upon entry, and then pay a
B
.. portion of their revenues to the Government. However, after
August, 1999 the revenue-sharing arrangement came into
effect.
5. Given an ambitious target to achieve a tele-density of
7%, the NTP 1999 sought to bring private players into basic
service which is the minimum facility and in which mobility as
c
feature of a telecom service was not a part of basic service.
The permissibility to provide a service is determined by the terms
and conditions of a licence granted by DoT whereas obligation
to pay interconnection usage charges/ADC is determined by
TRAI through its regulations framed under section 36 of the 1997 D
. -"' Act in conformity with the licence conditions.
6. By a policy decision of Government of India in 2001,
basic service operators having the licence for providing fixed
service were allowed to provide Wireless Local Loop Mobile E
[WLL(M))] service within the purview of their basic service
licence.

7. During 1997 -April, 2003, there was no liability to pay
ADC ( a concept introduced by TRAI in 2003).
8. On 1.11.2003, DoTintroduced a Unified Access Service
F·
.., ..(
("UAS") licence which allowed its holder to provide wire-line as
· well as wireless services in a service area. However, wireless
services included full mobile, limited mobile and fixed
wireless services under the UAS licence. The existing
service providers were given the option to stay on their original G
licence or change to the UAS licence to facilitate
communications convergence by allowing value-added services
-· on the same licence. However, all telecom operators had to pay
IUC including ADC in accordance with IUC Regulations framed
byTRAI. H
318 SUPREME COURT REPORTS [2008] 7 S.C.R.

A WLL Technology: ... ~

9. Before considering the contentions advanced on behalf
of the appellants and BSNL (respondent no. 1), it would be
necessary to consider certain terms used in the WLL technology.

B i) Cellular Telephony

Cellular telephone is a type of short-wave analog or digital
transmission in which a subscriber has a wireless connection
from a mobile (terminal) to a nearby transmitter. The transmitter's
area of coverage is called as a cell. In wireless telephony, a cell
c is the geographical area covered by a cellular telephone
transmitter. The transmitter facility is called the cell site. When
a subscriber enters into an agreement with a cellular telephone
service provider, he is given access to the cell system of that
provider, which is local. When travelling out of the range of the
D said cell system, the cell system can enable him to be transferred
to a neighbouring company's cell system without the subscriber
being aware of it. This is called roaming service. A cellular l .
telephone is not to be confused with a cordless telephone, which
is simply a phone with a very short wireless connection to a
local phone outlet.
E
High mobility of the users is one of the important properties
of cellular telephone. The location of a user can change
significantly during a call which can originate from the user or
from the network. In cellular telephony a mobile user
F communicates with a base station. The base stations are
connected to MSC, which is connected to the public telephone \.- ~

system. The most important aspect of cellular telephony is the
unlimited mobility. The user can be anywhere within the
coverage area of the network (i.e., !t is not limited to a
G specific cell). The user can move from one cell to another even
during one call.
Cellular telephony is different from cordless telephone. In
'-
cordless telephone, there is a wireless link between a handset
and a base station which in turn is directly connected to the
H public telephone system.
TATA TELESERVICES LTD. v. BHARAT SANCHAR 319
NIGAM LTD. AND ORS. [KAPADIA, J.]

It is important to note that economic factors impact the A
'""' design of wireless communication systems and services. Those
systems where the mobility is of value per se - e.g., in cellular
telephony, the same is more expensive than wired system. For
example, the per minute price in the case of cellular telephony
system is higher than the landline telephone. It is competition B
which may bring down the price per unit. Since 1990 many
consumers and even companies have opted for cellular
telephony alone cancelling in some cases wired services. On
the other hand, services where wireless access is only intended
as a cheap cable replacement, without additional features -
e.g., Fixed Wireless Access, the systems have to be cost
c
effective, as the infrastructure is comparatively cheaper as
compared to the infrastructure needed for wired connections.
ii) Examples of Wireless Equipments:
Wireless is a term used to describe telecommunications D
in which electromagnetic waves carry the signal over the
communication path. The first wireless transmitter went on the
air in the early 201h Century using Morse code. Later, as
technology improved it became possible to transmit voices and
music via wireless, the medium came to be called "radio". With E
the advent of television, fax, data communication and the
effective use of the spectrum, the term "wireless" has been
revived. The common examples of wireless equipments in use
today include cellular phones, pagers, global positioning system
("GPS"), cordless telephone sets, satellite television, wireless F
LANs (Local Area Networks), global system for mobile
--!
communication ("GSM"), fixed wireless application, mobile
wireless and portable wireless. Correspondingly, services are
broadcasting, paging, fixed wireless access (FWA), limited
mobility and full mobility etc.
G
In the case of fixed wireless, the operation of wireless
systems is confined to homes and offices, in particular, fixed
->
wireless refers to equipment connected to the internet via
specialized modems. In FWA, the location of the end-user
terminal and network access point to be connected to end-user H
320 SUPREME COURT REPORTS [2008] 7 S.C.R.

A are fixed.
In the case of mobile wireless, there is the use of wireless
systems or devices aboard motorized, moving vehicles like,
PCS. It also includes automotive cell phones. Unlike FWAs, in
the case of mobiles the instrument is not fixed, it can be moved.
B
As regards portable wireless, it is battery-powered
wireless device or system which operates outside the office,
home or vehicle. Its operation is autonomous. The examples of
portable wireless are handheld cell phones and PCS units.
C All the above examples are common examples of wireless
equipments in use today.
iii) Wireless Mobile Communication:
There are a variety of wireless communication systems
D for transmitting voice, video and data in local or wide areas.
Mobile wireless technologies provide voice and data
communication services to mobile users to use cell phones,
internet terminals and related computing devices.
iv) Wireless Communications Service (WCS):
E
WCS is radio communications that may provide fixed,
mobile, radio location or satellite communication services to
individuals and businesses within their assigned spectrum block
and geographical areas. WCS is today capable of providing
F more advanced Wireless Phone Services that would be able to
pinpoint a subscriber in a given locality. WCS is today used to
provide a wide variety of mobile services, including an entire
family of new communication devices utilizing small, light weight;
multifunctional Portable Phones and advanced devices with two-
G way data capabilities. It may be noted that every mobile is
portable but every portable phone need not be a mobile. It may
also be noted that we are concerned with "service" to the
individual business and not with the nature of the instrument.
v) Wireless Broadband Access Technologies
H (WBAT):
TATA TELESERVICES LTD. v. BHARAT SANCHAR 321
NIGAM LTD. AND ORS. [KAPADIA, J.]
~

"
Wireless access systems are owned by service providers A
that operate within a metro areas.
The cellular telephone system, as covered under "wireless
mobile communications" allows users to move about, not only
within the range of the Local Base Station but to other cells within
.... B
the same system and even to systems of other service providers.
The "Fixed" wireless systems do not support the extended
roaming features of Mobile Cellular Systems.
The advantage of wireless systems are: no need to install
cable or rely on copper infrastructure. c
vi) Wireless Communications (WC):
It involves transmitting signals through air and space using
radio waves. Examples blue tooth, CDMA.
D
...I. vii) Wireless Technologies (WT):
A wireless network is a radio, microwave, infrared network.
Most wireless networks have multiple BTSs. (base stations).
viii) Cellular Systems and Topology:
E
A cell in a cellular system is a circular area with a central
transmitter/receiver base station. BTS is raised up on a tower
or top of a building. BTS has a 360-degree antenna which is
tuned to create a cellular area. When a user turns a phone on,
its phone number and serial number are broadcast within the F
-I
local cell. The BTS picks up the signals and informs the
Switching Office that a particular device is located within its area.
This information is recorded in the switching office for reference.
An actual call takes place when the user enters a phone number
and hits the Send button. The cellular system selects a channel G
for the user to use during the duration of the call. As users travel,
-· they may move from one cell to another, necessitating a hand off
and the selection of a new channel. While in the vicinity of a cell,
mobile phone users are under the control of the transmitter/
receiver in that cell. A handoff takes place when the base station
H
322 SUPREME COURT REPORTS [2008] 7 S.C.R.

A in one cell transfers control for a user's call to a base station in
another cell. When a base station begins to lose a user's signal,
it notifies base stations in all the surrounding cells that the user
may be moving into their cells. As the user moves into a new
cell, the base station in that cell takes over the call. The frequency
B of the call is changed to a frequency used in the new cell during ~
the transition. This is because adjoining cells cannot use the
same frequencies.

ix) Wireless Local Loop (WLL):
c Today, technologies provide WLL services, i.e., wireless
access for home and business users to carriers and service
provider network.
According to Encyclopedia of Networking &
Telecommunications by Tom Sheldon, wireless local loop
D ("WLL") refers to a variety of technologies for connecting
)..
subscribers to the public-switched telephone network ("PSTN")
using wireless links, rather than copper wire. WLL is a practical
solution for connecting subscribers in countries/areas that do
not have the wired infrastructure. It is also practical in rural areas
E as an alternative to laying cable. WLL is primarily a fixed
wireless service (the subscriber generally stays in one
place), while cellular systems offer mobile communication
and roaming among different systems.
x) Basics of Wireless Communications:
F
Today's wireless communications would not be possible
without radio signals which are generated and emitted from a
sender. "They propagate through the atmosphere, and are
received and interpreted by a receiver. There are two
G applications for radio signals. First, they are needed for wireless
communication between a mobile terminal and a fixed network,
which is achieved by manipulating the parameters of the signal
which process is known as modulation. Secondly, radio signals
provide the basis for positior.ing, that is to say for locating the
H target.
TATA TELESERVICES LTD. v. BHARAT SANCHAR 323
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·~

In wired network, the transmission media are copper A
twisted pair, copper cable and optical fibre whereas the
transmission medium for wireless communication is always the
atmosphere, the space or water. Some wired systems like
Ethernet make use of voltage pulses to transmit data. Signals
in wireless communications are electromagnetic waves which B
are analog.

Electromagnetic waves are produced and received by
antennas. The receiving antenna converts radio signals from
the surrounding environment into alternating current and delivers
it to electronic equipment connected to the antenna, known as c
the receiver. Conversely, the transmitting antenna, on the
other hand, radiates alternating current delivered by a transmitter
into the surrounding environment in the form of radio or micro
wave signals.
D
--" The point to be noted is that there is a dichotomy between
receiving antenna and transmitting antenna. The antenna inside
the instrument is the receiving antenna whereas the antenna on
the BTS is the transmitting antenna.
In short, there exists major differences between wired and E
wireless media. In wired communications, signals pass through
a solid or guided medium whereas in wireless communications
the technology is based on unguided media like atmosphere,
space or water and, therefore, in wireless communications
signals are exposed to several sources of interference on their F
--+
way from the transmitting to the receiving antenna. Broadly, we
may call this process of transmission to the receiving antenna
as "transmission technology" which is a part of what is called
as access network in contradistinction to what is called as core
network of which the numbering plan is one of the important
G
components. This dichotomy needs to be kept in mind for
_, deciding the present matter. In other words, the receiving antenna
in the subscriber's premises and the transmitting antenna
.... located in the BTS are aligned and they constitute access
network whereas MSC is the exchange in which there is core
H
324 SUPREME COURT REPORTS [2008] 7 S.C.R.
,.
A network consisting of BSC, numbering plan, softwares etc.

.,.
which are essential to identify the source from which the call
originates, the movement of the subscriber from one cell to the
other and the identification of the call for billing purposes. The
Intelligent Network is in MSC.
B Generally, radio signals are emitted from an antenna omni-
directionally and they can pass several hundreds of kilometers
without being affected by obstacles (what is known as
seamless), which makes radio signals very attractive for radio
and television broadcast.
c
In wireless communications, different types of antennas
are used which differ from each other in respect of directivity of
signals propagation. When signals travel away from a
transmitting antenna in a BTS, they are exposed to a
reduction in their strength. The degree of attenuation depends
D
upon the distance between the transmitting antenna and the ,L
receiving antenna, the wavelength of the signals and the
surrounding environment (e.g., indoor, outdoor, rural, urban etc.).
In wireless communications, the air interface (medium)
E must be shared between different applications (e.g., radio, T.V.,
mobile, cellular systems etc.) and within a certain application
between different users (radio and T.V. stations, subscribers).
This is in contrast to wired infrastructures. In wireless
communications, the resources of the air interface are given by
F space, frequency, time and code and thus classified as space,
frequency, time and Code Division. The point to be noted is
..
that all channels transmit simultaneously in the same frequency
range and in the same space, thereby interfering with each other
to a large extent. This means that the signals of different channels
are summed up during transmission and, therefore, must be
G
separated after reception at the receiver. One of the methods
to do so is called as CDMA (Code Division Multiple Access). ,_
Under this method, different channels are separated by a code.
During transmission, the signals from different senders ~
arrived in the form of a composed signal at the receiver. In
H
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...
'"""' order to reconstruct the data of different senders, the receiver A
has to apply the chipping sequence of the respective sender.
Accordingly, the resulting signal reaches the receiver. ln the
present case, "Walky'' is based on CDMA technology. So also
the "Handset" of Reliance lnfocomm Ltd. is based on the same
... technology. It may be stressed that CDMA is the very complex
technique requiring sophisticated hardwares both in the centres
B

and the receivers. As all senders transmit in the same frequency
range simultaneously, the radiating power must be carefully
aligned between them in order to guarantee that all senders
can be heard at the receiver. c
The fundamentals explained hereinabove are relevant to
the transmissioning of data for each kind of mobile service
as well as for positioning. Transmissioning of data as a concept
is different from positioning. Transmissioning relies on
manipulation of radio signals whereas positioning is based on D
-~ measurement of radio signals especially their travelling time or
their attenuation
xi) Principles of Cellular Networks:
.,'
Mobile communications reached the market in 1980. Even E
at that time the major challenge was to implement advanced
mobility features such as handover, roaming and localization
of subscribers which required additional control channels
between terminal and serving base station.
\ A cellular network consists of a number of radio cells F
- ~· where the term "cell" refers to geographic coverage area of a
BTS. The size of the coverage area depends on the signal
strength of the base station and the degree of attenuation. Each
BTS is assigned a certain number of channels for transmitting
and receiving data which is called as cell allocation ("CA"). To G
avoid interference between cells, it needs to be guaranteed that
r• the neighbouring base stations are also assigned cell allocations
of different channels. There are no sharp borders between
neighbouring cells. Most of the time they overlap. In urban areas,
a mobile device can hear a set of around 10 base stations H
326 SUPREME COURT REPORTS [2008] 7 S.C.R.

A simultaneously, and then it selects from this set of base station
within the strongest signal. The number of cells a network is
made up of is basically a function of the size of area to be
covered and the user penetration. When building up a new
network, operators first concentrate on establishing a coverage
B in congested urban areas before establishing base stations in
rural areas. If a network runs the risk of becoming overloaded in
a certain region, the operators can increase the capacity by
increasing the base stations density.

A cellular network not only consists of base stations
C but also comprises a network infrastructure for
interconnecting base stations, mobility support, service
provisioning and connection to other networks like
internet. Therefore, a cellular network consists of several
access networks, which include the radio equipment
o which is necessary to interconnect a terminal to the
network. The access networks are interconnected by the core
network. For example, in GSM, the access network is referred
to as Base Station Subsystem ("BSS") whereas the core network
is denoted as Mobile Switching and Management Subsystem
E ("SMSS"). BSS is responsible for monitoring and controlling
the air interface. BSS consists of two different components,
namely Base Transceiver Station ("BTS") and Base Station
Controller ("BSC"). BTS stands for "base station". It contains
transmitter and receiver equipment as well as an antenna. The
base station is equipped with very limited capabilities for
F signalling a protocol processing. The bulk of the work, for
example, allocation and release of channels is done by the
BSC. The BSC is mainly responsible for control and execution
of handover, a function which is needed to keep a circuit-
switched connection if the subscriber moves between base
G stations. Therefore, each BSC controls several base $tations,
which are connected to the BSC via fixed lines or radio link
systems. On the other hand, mobile Switching and Management
System is a fixed network of switching nods and databases for
establishing connections from and to the mobile subscriber. HLR
H and VLR are two important databases which are the foundation
TATA TELESERVICES LTD. v. BHARAT SANCHAR 327
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~·
of the Numbering Plan in MSC. The switching components are A
the Mobile Switching Centre ("MSC") and the Gateway MSC
("GMSC"). The MSC connects a number of BSCs. to the network
for the purposes of localization and handover. Thus, it is the
MSC which is responsible for serving a limited geographic
region governed by all base stations connected to the MSC B
..... over their BSCs. In a mobile network, when a connection is to
be established it is the MSC which determines another switch
depending on the current location of the mobile subscriber. Fo'r
this purpose, MSC is also connected to local network for each
subscriber so as to implement the numbering plan. The area c
from which the call emanates, the identification of the nature of
the call whether from mobile or fixed wireline is all done by the
computer having the requisite software in MSC.

xii) Fixed Wireless Access WLL(F):
... Fixed wireless access ("FWA") also known as WLL(F) has
D

~ coverage between Wireless Local Area Networks ("WLANs")
and cellular communication systems. The main purpose of
FWA is to provide network access to buildings through
exterior antennas communicating with central radio base
stations. In this way, users in a building are allowed to connect E
to the network with conventional in-building networks.

FWA is a service in which wireless access is intended as
a cheap cable replacement without additional features.
F
.
..,,
FWA replaces copper lines to the homes of the users by
wireless links, but without the specific benefit of mobility. The
original intent was to give access to customers for basic phone
services bypassing the copper lines.
Fixed wireless access system is one type of service. FWA
G
system can also be considered as a derivative of cordless
phones or wireless local area networks. FWA system essentially
replaces a dedicated cable connection between the user and
the public land line system. The important difference to be noted
is that FWA system is not the same as cordless phones. The
H
328 SUPREME COURT REPORTS [2008] 7 S.C.R.

A main difference from cordless system is that in FWA ... ..
system there is no mobility of the user devices. There is a
difference between mobility and portability. A mobile device can
be portable but every portable device is not mobile. The purpose
of FWA lies in providing users with telephone and data
B connections without having to lay cables from a central switching
office to the premises of the user. It is, therefore, cost effective -.. /
as compared to wireline basic phone.

xiii) Identification of a Mobile Subscriber:

In analog wireless network every mobile station ("MS") is
c identified by a single number that is permanently associated
with it. All connections that are established from this MS are
billed to its registered owner. However, in the case of GSM, the
subscriber is identified by a SIM, which is a plug-in chip card. In
the case of GSM, MS can only make and receive calls when
D
such a SIM is plugged in and active. All calls that are made from ...
the MS are billed to the subscriber whose SIM is plugged in. J..
Furthermore, the MS only receives calls going to the number of
the SIM owner. Therefore, SIM is a fundamental importance for
billing procedure. It may be noted that even in "Walky'' there is
E plug-in chip card which is inbuilt in the instrument.

Mobility is an inherent feature of most wireless systems. If
there is an incoming call from MS (user), the network has to
know in which cell the user is located. The first requirement is
F that a MS emits a signal at regular intervals, informing nearby
base stations in the neighbourhood. Two databanks then
employ this information: the Home Location Register ("HLR") ~·

and the Visitor Location Register ("VLR"). The HLR is the central
data base that keeps track of the location a user is currently at;
the VLR is a data base associated with a certain base station
G
that notes all the users that are currently within the coverage
area of a specific base station. If a MS moves across a cell
boundary, a different base station becomes the serving base
station. In other words, the MS is handed over from one BS to
another. Such a handover has to be performed without
H
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interrupting the call. A
The HLR contains all the numbers of the mobile
subscribers associated with one MSC and information about
the location of each of these subscribers. In the event of an
incoming call, the location of the desired subscriber is checked
in the HLR and only thereafter the call is forwarded to the 8
location. The call is forwarded to the BSC in whose area the
subscriber is routing to and selection of one BTS is the
responsibility of the BSC. Therefore, one can conclude tl'lat from
time to time a controlling MS (user) has to send updates of its
location to its HLR. At the same time, the VLR and the MSC C
contains all the information about mobile subscribers from other
networks that are in the area of this MSC and are allowed to
roam in the network of this MSC. The Authentication Centre
verifies the identity of each MS requesting a connection.
D
The above discussion indicates the functionality of MSC,
BSC and BTS. The data base is in MSC. It further indicates the
functionality of BTS. BTS is, essentially concerned with
transmission. The entire data base and the function of identifying
the user and the call is in MSC. The numbering plan is one of
the important elements of the network with MSC. The switching E
system is with MSC. The network and switching system includes
the above two databases ..
The main component of network and switching ~t1bsystem
("NSS") is MSC, which controls the traffic between different F
BSCs. One function of the MSC is mobility management. Other
functions are paging and location update. All interactions
between networks - especially the landline public
switched telephone network ("PSTN") - are performed
by the MSC. Therefore, the numbering pl<i"n, radio G
frequency ("RF"), BTS, BSC, MSC, databases etc. form
elements of the network of the service providers.
The BTSs. and BSCs. are important components of base
station subsystem ("BSS"). The components of BSS are
different from the components of network and switching H
330 SUPREME COURT REPORTS [2008] 7 S.C.R.

A subsystem ("NSS"). The component of NSS is MSC whereas
the component of SSS consists of base transceiver stations
("STSs.") and base station controllers ("SSCs."). The STS
establishes and maintains the connection to the mobile stations
("MSs.") within its cell. The interface between the MS and the
s STS is the air interface. The STS hosts the antennas and the
radio frequency hardware of a base station, as well as the
software for multiple access. Several BTSs. are connected to.
one BSC; they are either co-located, or connected via landline,
microwave radio links, or similar connections.

C The SSC has a control functionality. It is responsible for
Hand Over ("HO") between two STSs that are connected to the
same SSC. Distribution of the functionalities between STS and
SSC may differ depending on the manufacturer. In most cases,
one SSC is connected to several STSs. Therefore, it is possible
0 to increase the efficiency of implementation by shifting as much
functionality as possible to the SSC. In general, the SSS is
responsible for channel assigning, maintenance of link quality
and HO, power control, coding and encryption.

xiv) Difference between Wireless Systems and
E Services:
In systems, mobility per se is of value - e.g., in cellular
telephony. Such services can charge a premium to the customer
- i.e., it is more expensive than equivalent wired systems. In
F cellular telephony the per-minute price is higher than landline
telephony and yet on account of competition, the price has come
down.

Services where wireless access is intended as a cheap
cable replacement without additional features have to be cost-
G effective, as the infrastructure thereof has to be cheaper than
wired connections. The classic example of such services is FWA.

In the case of systems, mobility is of value whereas in case
of services, wireless access is a cheap cable replacement
without additional features.
H
TATA TELESERVICES LTD. v. BHARAT SANCHAR 331
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..,..
References: A
The above technical data of concepts between sub-paras
(i) to (xiv) is based on references from the following books:

1. Wireless Communications by Andreas F. Molisch
B
2. Wireless Intelligent Networking by Gerry Christensen,
Paul G. Florack and Robert Duncan.

3. India - The Emerging Giant by Arvind Panagariya

4. Location-Based Services - Fundamentals and
Operation by Axel Kupper c
5. From WPANs to Personal Networks-Technologies
and Applications by Ramjee Prasad and Luc
Deneire

.. _).
6. Mc Graw Hill - Encyclopedia on Networking &
Telecommunications by Tom Sheldon
D

7. Encyclopedia of Technology Terms by Whatis.com
xv) Generic Requirements:
E
(a) Generic Model of Wireless Local Loop System:
Apart from references to the technical data hereinabove,
Government of India (DoT) has issued G.R. No. G/WLL-01/01.
MAY 96 regarding generic requirements relating to Digital WLL
/.
system. These generic requirements issued as far back as May, F
--;
1996 is in consonance with the technological concepts
enumerated in the above reference books. It supports what is
stated hereinabove. We, therefore, quote hereinbelow relevant
paragraphs from the above G.Rs.:
"1.0 INTRODUCITON G

_, 1.1 This Generic Requirement (GR) relates to digital
Wireless Local Loop (WLL) system to provide two way
communication for Department of Telecommunication
(DoT) customer Access Network. It shall be engineered
H
332 SUPREME COURT REPORTS [2008] 7 S.C.R.

..
A to provide Wireless connections to cover subscribers
located upto 25 kms from the exchange. The specification
covers the technical and general requirements of the
various components of WLL system namely Base Station
Controller (BSC), Base Station (BS), Network
B Management System (NMS), and Remote Station (RS).
The Remote Station shall be a Fixed Subscriber Adapter
Unit capable of supporting standard 2W analogue
interface such as standard telephone, FAX, Data Modem,
Payphone and 64 kbps interface as applicable.
c
1.3 A generic model of Wireless Local Loop system
consists of :
1. Base Station (BS)
D 2. Remote Station (RS)
3. Base Station Controller (BSC)
~ ...
4. Network Management System (NMS)
1.4 The Base Station Controller is responsible for inter-
E connection between the WLL system and the PSTN. It
assigns traffic channels to individual users, monitors
system performance and provides interface between the
BS and PSTN switch etc. BSC can be either co-located
with the PSTN switch or located at a different location
F connected to a PSTN switch through interfaces as
.,... ~
specified at clause No.13.1 of this GR. In case of junction
interface with PSTN, BSC shall provide switching and
charging functions for the area covered by the BSC.

G
1.6 The Base Station (BS) is a conveniently located
multiple circuit Transceivers which shall radiate over a cell
or a sector. It consists of radio modules, baseband signal
processor, network interface, antenna. feeder ':ltG. It can
H be co-located with BSC or remotely located.
TATA TELESERVICES LTD. v. BHARAT SANCHAR 333
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1. 7 The Remote Station (RS) provides single circuit and A
optionally multiple circuit access to the network. The
functions of the Remote Station are to convert user's
message from its original form into appropriate digital
signal and translate this signal into a form suitable for
radio transmission, to establish access to the network B
through Base Station. It has also the power supply, user
interface, antenna, feeder etc. and does not include
customer premises equipment.
1.8 The system shall permit the same facilities to the
subscriber as are available to the wire line subscribers C
as defined in clause No.4.2 of this GR.

2.0 GENERAL REQUIREMENTS
D

2.12 Remote station equipment shall be a fixed indoor/
outdoor unit .suitable for wall mounting with minimum
inconvenience to the subscribers .. All accessories for
mounting shall be supplied alongwith the,equipment. E

2.20 Mobility functions : optionally the system may support
limited mobility within designated area. The mobile
handsets shall conform to relevant standards for mobile F
application. The equipment supplier shall indicate the
coverage area for mobility for the equipment offered.

12.0 Network Management System (NMS) : G
The Network Management System (NMS) shall be-capable
of performing the following functions:
i) Fault localization including BSC, BS, RS and links
between them.
H
334 SUPREME COURT REPORTS [2008] 7 S. C.R.

A ii) Network configuration i.e., addition, deletion and
change of network elements etc.
iii) Performance, data collection.
iv) Security against unauthorised access
B v) Network statistics - Data related to channel
occupancy, rejected calls etc. with visual display of faulty
elements of the network.

c 15.0 Antenna : The type of antenna and gain may be
decided by the supplier for getting desired coverage and
performance of the system. Detailed specifications
(technical as well as mechanical) shall be furnished by
equipment supplier. Fixtures for antenna mounting at BSs
D and RSs shall be included as part of antenna supply."
(b) Principles of Wireless Access:
Principles of wireless access have also been enumerated
in recommendations of International Telecommunication Union-
E Radio Communication Assembly ("ITU-RCA"). They are as
follows:
"1 Introduction
This Recommendation consists primarily of those terms
F and definitions that are considered essential to the
understanding and application of the principles of wireless
access. However, they are not exclusive to wireless access
and are recommended also for application, insofar as
they are relevant, to other types of telecommunication
G systems and services.
Included are terms that may already be defined in the
Radio Regulations (RR) and other ITU-R/ITU-T
Recommendations. However, the definitions given here
embrace only the essential concepts a;id on this basis it
H is considered that they are not inconsistent with the more
TATA TELESERVICES LTD. v. BHARAT SANCHAR 335
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specialized definitions that appear in those texts. A

Where a truncated term is widely used in an understood
context, the complete term is quoted following the colloquial
form.

Some definitions include terms in italic face to indicate B
that these terms are defined elsewhere in this
Recommendation.

Technologies in use today for implementing wireless
access include cellular systems, cordless phone and
cordless telecommunication systems, satellite systems, C
etc. New technologies and systems such as IMT-2000,
wireless broadband ISDN, wireless ATM, HAPS, etc., also
form part of wireless access if they satisfy the basic criteria
of end-user radio connection(s) to core networks
D
Wireless access may be considered from many
perspectives, for example:
- Mobility capabilities of the terminal: fixed, nomadic (may
be used in different places but the terminal 1T1USt be
stationary while in use), mobile, restricted mobility (e.g. E
within a single cell), etc.

- Service support capabilities: narrow-band, broadband,
multimedia, etc.

- Type of telecommunication service: conversational, F
distribution, information retrieval.

- Connectivity: (which would depend on the switched
network that the terminal accesses,

e.g. Internet, PSTN, etc.). G
- Radio transmission technology: access technique
(TOMA, CDMA, etc.), modulation

technique (analogue, digital, etc.), duplex technique (FDD,
TDD, etc.), etc.
H
336 SUPREME COURT REPORTS [2008] 7 S.C.R.

A - Delivery mechanism: terrestrial, satellite, etc.
Of particular interest are the mobility characteristics of
wireless access systems; thus this Recommendation
provides definitions of the terms "fixed", "mobile" and
"nomadic" wireless access.
B
The purpose of this Recommendation is to specify terms
and definitions for terrestrial wireless access.

2 Scope

c The Recommendation specifies definitions for terms
primarily focused in the field of terrestrial wireless access
systems. Wireless access applications may be provided
within the definitions of the radio services FS, MS, FSS
and MSS contained in the RR.
D The ITU has deprecated the use of the term "loop" (see
References below: CCITT Blue Book, Vol. I, Fascicle 1.3,
1988); for this reason, and more so because this term
does not make any sense with radio technologies, the
use of the terms that include loop are deprecated. These
E include wireless local loop, radio local loop, and wireless
access local loop.
It should be noted that in many cases systems may be
able to support a mixture of users (i.e. fixed, mobile and
nomadic) and possibly with restrictions on the type of
F mobility It is not practical to define terms for each possible
combination, but those above should suffice to refer to the
primary characteristics of the system."
In addition, the said recommendation also defines relevant
G terms. The said definitions are contained in clause 4.1, which
reads as follows:
"4.1.1 Wireless access
End-user radio connection(s) to core networks.
H NOTE 1 - Core networks include, for example, PSTN,
TATA TELESERVICES LTD. v. BHARAT SANCHAR 337
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JSDN, PLMN, PSDN, Internet, WAN/LAN, CATV, etc. (See A
§ 4.4 for list of acronyms and abbreviations.)
NOTE 2 - The end-user may be a single user or.a user
accessing the services on behalf of multiple users.
4.1.2 Fixed wireless access (FWA) B
Wireless access application in which the location of the
end-user termination and the network access point to be
connected to the end-user are fixed.

4.1.3 Mobile wireless access (MWA) c
Wireless access application in which the location of the
end-user termination is mobile.

4.1.4 Nomadic wireless access (NWA)
Wireless access application in which the location of the D
end-user termination may be in different places but it must
be stationary while in use.

4.2.2 Base station E
See central station.

4.2.4 Central station
F
The common name for all the radio equipment located at
one and the same place used for serving one or s.everal
cells.
NOTE 1 -Also known as hub station, and also as base
station, even though RR No. 1. 71 defines base station G
more restrictively as "a land station in the land mobile
service".
4.2.5 Customer premises equipment/network
The equipmenUnetwork administered by the user H
338 SUPREME COURT REPORTS [2008] 7 S.C.R.

A NOTE 1 - Based on ITU-T Recommendation H.310.

4.2.8 End-user
A human being, organization, or telecommunications
B system that accesses the network in order to
communicate via the services provided by the network.
(See ITU-T Recommendation J.112.)
4.2.9 End-user connection point
c
Point at which the end-user obtains the communications
service (see Fig. 1).
4.2.10 End-user termination, end-user radio
termination
D
The end-user radio equipment antenna (see Fig. 1).
FIGURE 1
Illustration of terms
End-user radio End-user connection point
E Termination

i
D········· RNA.radio
station
F

)l.ntenna
01
G Poof-
Fixed
NeM.ork
xvi) Classification of Services under Licence
Agreement for Provision of Unified Access Services after
H Migration:
TATA TELESERVICES LTD. v. BHARAT SANCHAR 339
NIGAM LTD. AND ORS. [KAPADIA, J.]

At the outset, it may be stated that appellants herein, who A
were holders of basic service licence(s) migrated to Unified
Access Services in November, 2003. The said U.AS licence is
dated 20.7.2001w.e.f.21.11.2003.

The said UAS licence covers "access service" which
includes wireline and/or wireless service including full mobility, B
limited mobility and FWA. Basically, in these civil appeals we
are concerned with three wireless services, namely, full mobility,
limited mobility and FWA. What is FWA has also been explained
earlier in this judgment. We quote hereinbelow clause 2.2(a)
and clause 2.2(c)(i), which read as follows: c
"2.2 (a) The SERVICES cover collection, carriage,
transmission and delivery of voice and/or non-voice
MESSAGES over LICENSEE's network in the designated
SERVICE AREA and includes provision of all types of D
access services. In addition to this, except those services
listed in para 2.2 (b)(i) licensee cannot provide any service
I services which require a separate licence. The access
service includes but not limited to wireline and I or wireless
service including full mobility, limited mobility as defined
in clause 2.2 (c) (i) and fixed wireless access. However, E
the licensee shall be free to enter an agreement with other
service provider(s) in India or abroad for providing roaming
facility to its subscriber under full mobility service unless
advised I directed by Licensor otherwise. The LICENSEE
may offer "Home Zone Tariff Scheme (s)" as a subset of F
full mobile service in well defined geographical Areas
through a tariff of its choice within the scope of orders of
TRAI on the subject. Numbering and interconnection for
this service shall be same as that of Full mobile
subscribers. G

2.2 (c) (i) In respect of subscriber availing limited mobility
facility, the mobility shall be restricted to the local area i.e.
Short Distance Charging Area (SDCA) in which the H
340 · SUPREME COURT REPORTS (2008] 7 S.C.R.

A subscriber is registered. While deploying such systems,
the LICENSEE has to follow the SDCA based linked
numbering plan in accordance with the National Numbering
Plan of the respective SDCA within which the service is
provided and it should not be possible to authenticate and
B work with the subscriber terminal equipment in SDCAs
other than the one in which it is registered. Terminal of
such subscriber in wireless access system can be
registered in only one SDCA. Multiple registration or
Temporary subscriber/ Subscription facilities in more than
c one SDCA using the same Subscriber terminal in wireless
access systems is not permitted and the same Subscriber
Terminal cannot be used to avail Limited Mobile facility in
more than one SDCA. The system shall also be so
engineered to ensure that handover of subscriber does
not take place from one SDCA to another SDCA under
D
any circumstances, including handover of the calls through
call forwarding beyond SDCA. The Licensee must ensure
that the mobility in case of such limited mobile service/
facility remains restricted to SDCA."

E The concept of limited mobility has been defined in clause
2.2(c)(i). The UAS Licence clarifies vide clause 2.2(c)(ii) that
the Basic Service operators like the appellants after migration
to Unified Access Licence Regime can also offer limited
mobility service for such customers who so desire.
F In these civil appeals we are concerned with the concept
of limited mobility as a service which attracts ADC.
Clause 2.2(d)(i) inter alia provides for compliance with
standards prescribed by !TU-RCA which have been quoted
G hereinabove. We quotre hereinbelow clause 2.2(d)(i), which
reads as follows:
"2.2 (d)(i) The LICENSEE is permitted to provide,
SERVICE by utilizing any type of network equipment,
including circuit and/or packet switches. that meet the
H relevant International Telecommunication Union (ITU)/
TATA TELESERVICES LTD. v. BHARAT SANCHAR 341
NIGAM LTD. AND ORS. [KAPADIA, J.]

Telecommunication Engineering Center (TEC) I A
International standardization bodies such as 3GPP/3.GPP-
2/ETSl/IETF/ANSl/EIA/TIA/IS".
Meaning of Interconnection Usage Charges ("IUC")/
ADC:
B
10. On 29.10.2003, TRAI notified IUC. ADC is a part of
IUC. ADC is a percentage of the revenue. The framework of
IUC regime was established by TRAI through its Regulation
dated 24.1.2003 which was subsequently reviewed on
29.10.2003 and 6.1.2005. IUC has to be determined based on c
minutes of usage for various network elements and the cost of
these elements.
11. ADC, on the other hand, is based on the consideration
of cost based rent, local call charges, low rental in rural areas,
> free calls etc. to make the basic telecom services affordable to D
the common man, to promote universal service and universal
access as required by NTP, 1999. It is important to note that
ADC does not arise out of any legal right. It arises out of
TRAl's consideration of smoothening the transition
process during competition, i.e., providing support during E
transition period when costs of access is not fully recoverable
from the revenues from access line monthly rental under the
existing tariff regime due to competition in the market. In other
words, ADC is a depleting regime for ADC purpose. Calls to/
from WLL(F) is similar to calls to/ from fixed lines. It is F
important to note that fixed wireless services, provided by
fixed service providers, and unified access service licences
are classified as Fixed Services. However, fixed wireless
services for all purposes tantamounts to full cellular
services and can be offered seamlessly throughout the G
SDCA which created a non level playing field for cellular.
operators vis-a-vis the fixed wireless service providers, which
has led to the present dispute, which is primarily concerned with
the "range of mobility" of Fixed Wireless Terminals provided by
appellants herein and Reliance lnfocomm and not with the size H
342 SUPREME COURT REPORTS [2008] 7 S.C.R

A of the instrument "Walky'' provided by appellants (Handset
provided by Reliance lnfocomm) or the technology used therein,
viz, wireless or wireline, in the context of levy of ADC.
Submissions:

B 12. Mr. Arun Jaitley, learned senior counsel for the
appellants, submits that the question to be decided in this case
is whether the appellants' instrument ("Walky'') falls in the
category of Fixed Wireless Service or WLL(M) service.
•
According to the learned counsel, the question of classification
c under Telecom Regulatory Authority of India Act, 1997 ("1997
Act") can only be decided upon by TRAI and not by BSNL as is
purported to have been done in the present case, particularly
I
when BSNL is a competing service provider and a contracting '.:·~

party under IUC Regulations. In this case, BSNL has demanded
ADC from the appellants for the period 14.11.2004 to 26.8.2005.
D ~
Learned counsel urged that, according to the appellants, the
instrument "Walky'' is a fixed wireless phone having portability
as its feature. That, BSNL had no authority to classify the said
instrument as a mobile phone.

E 13. According to the learned counsel, the abovementioned
WLL(M) is a service. It refers to a mobile set and not to a portable
FWP and, therefore, the said instrument "Walky'' which is portable
is not classifiable as WLL(M). That, in any event, classification
disputes lay before TRAI under the 1997 Act and that BSNL i-

F has no authority to classify/reclassify the said "Walky" as WLL(M).
In this connection, it is urged that BSNL could have filed its
complaint before TRAI and BSNL could not have unilaterally
called upon the appellants to pay ADC after such re-
classification. The questions raised on behalf of the appellants
is: Who pays ADC? Who decides as to who pays? In this
G
connection, it is further submitted that under section 11 (b)(ii) of
the 1997 Act, the terms and conditions for grant of Inter-
connectivity is to be fixed by TRAI; it is mandatory function of
TRAI to do so and, therefore, it 1s beyond the competence of
BSNL to re-classify and fix the ADC liability on to the appellants.
H
TATA TELESERVICES LTD. v. BHA~~AT SANCHAR 343
NIGAM LTD. AND ORS. [KAPADIA, J.]

14. Learned counsel urged that fr0rn 1997 to 2004, the A
said "Walky'' had been in the market to the knowledge of BSNL;
the market knew the distinction between the three services and
that the said Instrument stood classified during above period
.... as WLL(F). That, GOTIT had also treated it as WLL(F). That,
the appellants had moved TDSAT, in the present case, to set B
aside the demand of BSNL.only on ground that BSNL had no
authority to re-classify the said instrument from Fixed to WLL(M)
service. That, BSNL could have challenged the use of "Walky''
without payment of ADC before the TRAI in which event the said
Authority could have taken up and decided the cla,;sification c
dispute, but was not done.
15. It is next urged that "Walky" as an Instrument is portable,
not mobile and, therefore, BSNL had erred in reclassifying Walky
as WLL(M). Challenging the impugned decision of TDSAT, it is
• urged· on behalf of the appellants that TDSAT had erred in D
equating portability with mobility. That, the said two conGepts
are different. That, the Telecommunication Interconnection
Usage Charges Regulations, 2003 ("2003 Regulations") tre.1ted
WLL(M) and WLL(F) as a separate class of service. That, in
the absence of any change in the technology or the instrument E
and merely because of the advertisement issued by the
'"' appellants, the character of service or its classification cannot
change. In this connection it may be noted that appellants had
given on Advertisement (Ex.-P8) in which it was stated that
"Walky'' combines the best features of Mobile Phone and the F
Landline. That, BSNL had complained to TRAI regarding the
advertisement in which "Walky" was shown as WLL(F) by
invoking Rule 6 of the 2003 Regulations and when the matter
was sub-judice before the Authority, BSNL raised the unilateral
demand for ADC on the appellants which was mis-conceived.
G
~'
That, under the contract between BSNL and the appellants, there
was no provision to dis-connect the Access Facility, unilaterally.
16. Learned counsel urged that in the dispute raised by
the appellants before TDSAT the only question raised was
regarding unilateralism on the part of BSNL which TDSAT H
344 SUPREME COURT REPORTS [2008] 7 S.C.R.

A failed to decide and, therefore, the matter needs to be remitted
to TRAI. In this connection it is urged that under clause 2. 7 of
the Consultancy 'Paper the "extent of portability" was the question
pending to be decided by the Authority and pending decision,
BSNL had no authority to raise the demand.
B 17. On Technology, learned counsel urged that after
introducing the concept of ADC, the categories of the services
were Fixed Wireline, WLL(F), WLL(M) and Cellular which is now
re-classified unilaterally by BSNL and DoT as Fixed Wireline;
=
WLL(F) WLL(M) and Cellular. Learned counsel urged that if
C WLL(F) had to be shifted to WLL(M), then that question needs
to be looked into by the Authority, hence remand becomes
necessary as such re-classification cannot be done by BSNL
unilaterally. Learned counsel submits that correct classification
for ADC could have been done only by TRAI and not by BSNL/
D DoT and that too after following the procedure under section 11 ,,, .
of the 1997 Act.
18. Learned counsel next urged that neither in the Licence
nor in the 2003 Regulations is there any Premises Specific
Restriction ever imposed and, therefore, it was not open to
E BSNL to make the impugned demand as the said restriction
was not there during the relevant period. In this connection it
was urged that during the entire period between 1997 to
November, 2004, even DoT understood "Walky'' to be
portable in the entire SDCA; that only in March, 2005 it gave
F directions to the contrary to the appellants incorporating the
above "Premises Specific Restriction" and that too without any
change in the licence or the IUC Regulations 2003; that till
4.3.2005 the said restriction was never mentioned; that without
complying with section 11 of 1997 Act, TRAI could not have
G issued such a directive on 4.3.2005, particularly when it seeks
to impose a liability to pay ADC with retrospective effect.
Learned counsel submits that, in the circumstances, matter of
classification/reclassification arises which needs to be decided
byTRAI.
H
TATA TELESERVICES LTD. v. BHARAT SANCHAR 345
"-· NIGAM LTD. AND ORS. [KAPADIA, J.]

19. Mr. Gopal Subranianium, learned senior counsel on A
behalf of respondent no. 1 - BSNL, at the outset submits that,
this civil appeal is infructuous. In this connection, it is urge_d that
by Circular dated 4.3.2005 issued byTRAI, all Access Providers
(including appellants herein) were di~ected to ensure that the
terminal used for Fixed Wireless Services should be confined B
to the premises of the subscriber as the issue of mobility had
revenue implications. Learned counsel submits that this
circular has not been challenged till date and, therefore, this
civil appeal is infructuous.
-J
20. It is next urged that the contention of.the appellants c
that when consultation process was on BSNL could not have
made the Demand has no merit because in that Process' the
question was not of reclassification but the question w~s whether
ADC was payable to other Fixed Service Providers, besi.des
BSNL. In this connection, it was pointed out that before 1.2.2005, D
appellants herein used to receive ADC as Fixed Service
Provider in respect of "Walky'', however, after that date BSNL
alone became entitled to ADC which led to di?putes. It is urged
that neither the Consultation Paper nor the 2003 _~egufations
was concerned with characteristics of WLL(M) services as that E
issue stood decided by TRAI vide circular dated 4:3.2005 as
well as by Order dated 26.8.2005 issued by DoT by which it
was held that appellant had provided Fixed Wireless Terminals
as Mobile Terminals. The said Order of DoT stood complied
with by the appellant and, therefore, there was no merit in the F
contention of the appellant on the issue of unilateralism. The
said Order dated 26.8.2005 was passed by DoT after giving
show cause notice. It is based on breach of licence conditions
by appellants.
21. On the technology, it is urged on behalf of BSNL, that G
r·
WLL(M) is a service which is put in the "Walky''. It is urged that
WLL(M) is a service given by the instrument "Walky''. What is
relevant is the Service and not the Instrument. It is urged that the
appellants herein had invoked the Original Jurisdiction ofTDSA(
on the question of characterization of service which has been H
346 SUPREME COURT REPORTS [2008] 7 S.C.R.
.,....

A answered in favour of BSNL. It is urged, that nature and
classification of instrument was not relevant; that what was
relevant was the feature of the service in the instrument "Walky''
and whether that feature made it WLL(M) service, to which ADC
stood attracted. All these questions have been answered by
B TDSAT by its impugned judgment in favour of BSNL. By the
impugned judgment, it has been held by TDSAT that Walky Calls
attract ADC under the Regulatory Regime.

22. It was next urged that on facts there was no unilateralism

c
as the Demand was made by BSNL only after the TRAI and the .-
DoT had issued the above Circular and Directive respectively ',
which have not been challenged. It is pointed out that in fact
appellants have complied with Do T's order. Learned counsel
would submit that ifthere was compliance of the Order/Directive
of DoT dated 26.8.2005 there is no reason why appellants
D should not pay ADC for the period in question, viz, 14.11.2004 -~

to 26.8.2005. According to learned counsel, compliance of
DoT's Order dated 26.8.2005 itself indicates that even
according to the appellants. ADC was payable in respect of the
service, i.e., WLL(M) and, therefore, there is no merit in the
E argument advanced on behalf of the appellants that ADC could
not be charged without change in the conditions of licence or
2003 Regulations.

23. It was next contended that under 2003 Regulations,
reference is made to Fixed Wireless Access, Mobile Wireless
F Access and Nomadic Wireless Access. Before TDSAT, the
controversy was regarding WLL(M) Service in SDCA.
Before us it was contended that the levy of ADC is not on
movement of Walky within SDCA but it is in respect of service
rendered in SDCA. That, WLL(M) is a type of service within
G SDCA.

24. Learned counsel would submit that with the introduction
of Unified Access Service Licence ("UASL") in 2003 the
distinction between Fixed Wireless, WLL(M} and mobile stood
H obliterated. The said UASL 2003 brought in the Numbering Plan
TATA TELESERVICES LTD. v. BHARAT SANCHAR 347
'y NIGAM LTD. AND ORS. [KAPADIA, J )

which categorized the series in the said Plan to identify and A
measure the call for billing purposes. That, in terms of clause 2
of UASL, "mobility" refers to service(s) within SDCA.
25. The above arguments of learned counsel for BSNL
were adopted by Dr. A.M. Singhvi, learned senior counsel for
Cable Operators Association. B

26. Mr. Rakesh Dwivedi, learned senior counsel appearing
for intervenor-TRAI would submit that in November, 2000, TRAI
, recommended Limited Mobility Service, i.e., WLL(M) on
25.1.2001, DoT permitted it, whereas Walky came into the c
market only in October, 2004. According to learned counsel,
vide IUC Regulations, 2001, WLL(M) was defined which was
incorporated in UASL on 26.11.2003 and, therefore, appellants
were fully aware of the difference in WLL(M) Service vis-a-vis
WLL(F) and Cellular.
~
D
27. On technology, learned counsel submits that under
WLL(M), the terminal of the subscriber must be fixed to a socket
in the subscriber's premises. That, service given by the appellant
is that of Limited Mobility. That in case of WLL(F) the Basic
Phone Instrument has to be fixed indoor and since that is not E
the case of appellants, the instrument "Walky'' would fall in the
.., category of WLL(M) .
Finding:

28. India's phenomenal growth in the mobile subscriber F
base and penetration rate (or teledensity as measured by
number of phones per hundred) has attracted global attention.
Mobile phones have introduced competition in providing access
and ~ervices at global competitive prices and state-of-art
technology. The competition is now relevant not only among the
G
private providers of mobile services, but also among the private
,.- .
and public providers of both fixed and mobile services. India's
NTP 1999 emphasised the Government's commitment to
provide basic telecom services to all people at affordable and
reasonable prices. This commitment is called the Universal
H
348 SUPREME COURT REPORTS [2008] 7 S.C.R.

A Service Obligation ("USO").

29. At the outset, it may be stated, that, Regulatory
Restriction should not be confused with technology limitation.
With the technological advancement, "extent of mobility" has
gone way beyond the "Premises Specific Restriction" but in this
B case we are not concerned with technology but with the levy of
ADC. According to some authors, ADC is a tax. In the Revenue
Regime, the Authority imposing the levy is not always bound by
the concepts in technology. It is open to the Authority under the
Revenue Regime to impose by way of Regulatory Restriction a
c '
parameter like Premises Specific Restriction to explain the
concept of Limited Mobility.

30. WLL is a technology. In this case we are only
concerned with Wireless Local Loop Mobile Service. As a
technological concept, wireless in local loop technology simply
D
means that the subscriber is connected to the nearest exchange
of the appellants (MSC) through BTS (which is only concerned
with transmission) through a radio link instead of through the
copper wires. In general, it is cheaper than copper wire
connectivity. In traditional wire-line network, the cost of the Last
E Mile amounts to substantial portion of the total cost of putting up
the network. CDMA and FDMA are technologies used for WLL.
31. In this civil appeal we are not concerned with WLL per
se but with the concept of "limited mobility".
F 32. WLL is also called Broadband Wireless Access (BWA)
or fixed-radio access or fixed-wireless access or fixed wireless
terminal (FWT).
33. FWT units differ from mobile terminal units operating
within cellular networks - such as GSM - in that a fixed wireless
G
terminal or deskphone will be limited to an almost permanent
location with no roaming facility.
34. WLL + FWT are generic terms for radio based "
'
telecommunications technologies and the respective devices
H which can be implemented using a number of different wireless
TATA TELESERVICES LTD. v. BHARAT SANCHAR 349
'Y" NIGAM LTD. AND ORS. [KAPADIA, J.]

and radio technologies. In generic sense, WLL is a technology. A
It cannot be equated to WLL(M) which is a service like WLL(F).
Under the Worldwide Database, WLL does not refer to Limited
Mobility. Worldover WLL is used to provide Fixed Wireless
:r Access for speedy roll-out of fixed services. However, under
the NTP 1999, cellular operators are allowed to offer all types B
of mobile services whereas fixed operators like the appellants
are allowed to offer fixed services.

35. The core issue, therefore, is not whether Limited
Mobility is or is not possible but whether fixed operators are
liable to pay ADC when the service(s) provided by them fall in c
WLL(M) service.

36. The main contention advanced on behalf of the
appellants is regarding alleged unilateralism by BSNL in calling
upon the appellants herein to pay ADC. According to the
D
appellants, BSNL is a service provider and a competitor to the
appellants, therefore, BSNL has no authority to impose ADC
liability on the appellants. According to the appellants, BSNL is
a contracting party and, therefore, BSNL has no authority to levy
ADC unilaterally on the appellants. According to the appellants,
E
TRAI had issued its directive dated 4.3.2005 at the behest of
BSNL without TRAI itself decided the categorization of service.
According to the appellants, in any event, TRAI had acted at the
behest of BSNL in issuing the said directive. According to the
appellants, the said directive seeks to treat the Walky calls as
WLL(M) whereas all over the years between 1997 to 2004 the F
said service stood classified as WLL(F). According to the
appellants, if at all TRAI wanted to reclassify the said service as
WLL(M) it ought to have followed the procedure laid down under
Section 11 of the 1997 Act. The effect of such directive,
according to the appellants, is not only to reclassify the services G
r· but it also seeks to amend the terms and conditions of UAS
Licence. It may be stated that directive dated 4.3.2005 stood
clarified by DoT vide two clarifications dated 23.3.2005 and
26.8.2005. According to the appellants, the said clarifications
were issued in the context of advertisement given by the H
350 SUPREME COURT REPORTS [2008] 7 S.C.R.

A appellants, which were later on withdrawn and that the said
directive had no connection with ADC chargeability. According
to the appellants, Do Tis a licensor. According to the appellants,
DoT had no authority to categorize Walky as WLL(M). According
to the appellants, during the period 1997 to 2004, Do T and TRAI
B have treated Walky as WLL(F). According to the appellants, by
reclassifying Walky as WLL(M), DoT had sought to unilaterally
reclassify Walky as WLL(M) which amounts to change in licence
conditions. According to the appellants, reclassification could
have been done only by TRAI under Section 11 of 1997 Act and
C not by DoT. Therefore, as can be seen from the above
arguments, it is clear that the basic complaint of the appellants
is based on unilateralism in imposing ADC liability on them.
37. Before proceeding to deal with the arguments on
unilateralism, we quote hereinbelow, in extenso, the directive
D issued by TRAI dated 4.3.2005, clarification issued by DoT
dated 23.3.2005 and further clarification issued by DoT dated
26.8.2005, which read as follows:
"File No.406-2/2004-FN Dated 4th March, 2005

E To:
All the Access Providers

Subject:- Issues relating to WLL (F) services

The Authority has noted that fixed wireless services were
F being provided through fixed wireless terminals in which
the location of the network access point was fixed and
end user terminal was connected to it. Recently it has
come to the notice of the Authority that new terminals being
deployed by access providers do not have any fixed
G network Access Point physically located at the address of
the subscriber. In this regard certain complaints including
those of misleading advertisements have also been
received by the Authority and subsequently show cause
notices were issued to the concerned operators. The
H responses given by the service providers were not found
TATA TELESERVICES LTD. v. BHARAT SANCHAR 351
~ NIGAM LTD. AND ORS. [KAPADIA, J.]

to be in order. A
As the issue of mobility has implications with respect to
applicability of ADC, the Authority directs you to strictly ensure
that the terminal used for fixed wireless services should be
strictly confined to the premises of the subscriber. All Access
Providers should also ensure that there are no misleading B
advertisements in the electronic and print media. It should also
be further noted that it is licensee's responsibility to ensure that
the subscriber terminal is operated in accordance with the terms
of the License for fixed lines. Any violation will attract action
against you under the relevant clauses of the License c
Agreement
This issues with the approval of the Authority.
Sd/-
(R.K. Bhatnagar) D
Advisor (FN)"
.........
"No. 10-10/2003-BS llNol.VI
Government of India
Department of Telecommunication E
Licensing Cell (Basic Services Group)

1406 Sanchar Bhavan,
20, Ashoka Road
New Delhi - 110001 F
23'd March, 2005
To
All the UASL Licensees
BSNL and MTNL
G
!""·' Sub: Clarification regarding Fixed Wireless Terminal in
UAS/Basic Service Licence ..
With reference to the subject mentioned above, the
undersigned is directed to clarify that the terminal used for
H
352 SUPREME COURT REPORTS [2008] 7 S.C.R.

A fixed wireless services should be strictly confined to the
premises of the subscriber where the telephone connection
is registered. It should also be noted that it is licensee's
responsibility to ensure that the subscriber terminal is
operated in accordance with the terms of the Licence for
B fixed lines including this clarification.
This is to further reiterate that separate level within allocated
SDCA based Link Numbering is to be used for Wireline
& Fixed Wireless Services.
Wherever such restriction cannot be imposed, it shall be
c
treated as WLL (M) feature for all purposes which inter-
alia includes Numbering plan, Interconnection Usage
Charges, Interconnection arrangements etc.
(Subhash Chander)
D ADB(BS-11)
011-23036536

Copy to:
The Secretary TRAI, Safdarjung Enclave
New Delhi
E
Sr. DOG (VAS), DOT"

"Government of India
F Ministry of Communications & l.T.
Department of Telecommunications
Licensing Cell (Basic Services Group)
713, Sanchar Bhawan, 20, Ashoka Road, New Delhi-1
No.16-10/2004-BSll/TTSL 26th August 2005
G
To
M/s. Tata Teleservices Ltd.
1Q1h Floor, Tower-I,
Jeevan Bharti, Connaught Place,
H New Delhi-110001.
TATA TELESERVICES LTD. v. BHARAT SANCHAR 353
NIGAM LTD. AND ORS. [KAPADIA, J.]

Sub: Alleged Violc;ition of licence condition.s. A
Whereas Mis.Tata Teleservices Ltd. (Mis TTSL) has been
granted licence under Section 4 of Indian Telegraph Act, to
e~tablish, maintain and operate telegraph services in the
following service areas:-
B
S.No. SERVICE AREA LICENCE AGREEMENT NO.

1. Andhra Pradesh 10-02120041BSlllTTSL/AP
2. Gujarat 10-05120041BSlllTTSL/Guj. ·
3: Karnataka 10-09120041BSll/TTSL/KTK C
4. Tamil Nadu 10-17120041BSI l/TTSL/TN
5. Chennai 10-20120041BSI l/TTSL/Chennai
6. Delhi 10-21120041BSI l/TTSL/Delhi
7. West Bengal 20-201/20031TATAIBSlll D
8. Bihar 20-204/20031TATAIBSlll
9. Haryana 20-206/2003/TATA/BSlll
10. H.P. 20-20712003/TATA/BSlll .
11. Kerala 20-210120031TATAIBSlll · E
12. Madhya Pradesh 20-211120031TATAIBSlll
13. Orissa ·20-21412003/TATAIBSlll
14. Punjab 20-21512003/TATAIBS 111
15. Rajasthan 20-21612003/TATAIBSlll F
16. UP(W) 20-218120031TATAIBSlll
17. UP (E). 20-219120031TATA/BSlll
18. Kolkata 20-222/20031TATA/BSlll

Whereas a complain.! was received from Cellular G
Operators Association of India that Mis Tata Teleservices
Ltd. is providing fixed wireless terminals as mobile
terminals and such terminals are being openly advertised
and promoted as "WALKY-Enjoy freedom of mobility at
landline rates". H
354 SUPREME COURT REPORTS [2008] 7 S.C.R.

A Further it was pointed out that BSNL is being severely
disadvantaged as they have not received ADC from
WALKY Calls.
Whereas M/s. Tata Teleservices Ltd. was supposed to
provide services within the scope of its licence agreement
B and it was expected that by way of advertisement or
promotion of its services, the subscriber should not be
misled.

Whereas a notice was issued for alleged violation of
c conditions and not limited to clause 2 of Unified Access
Services Licences on 06.01.2005 and 31.01.2005
regarding WALKY service.

And whereas M/s Tata Teleservices Ltd. replied to the
notice vide letter dated 21.01.2005 and 02.02.2005 of
D stating that there has been neither any attempt nor any
intention to mislead any subscriber in relation to services
being provided by M/s TTSL and they continue to provide
services within this scope of licences. The Fixed Wireless
Terminal (FWT) instruments are prominently advertised
E as bulky desktop phones and therefore customer is clearly ,-
informed of the nature of the services and the phone .~

instrument. The numbering scheme of both FWT & Wireline
Phones is same and is different from that of limited mobile
services. The FWTs covered by one or sometime more
F than one Base Trans-receive Stations (BTSs).
M/s TTSL further submitted that "Walky'' is a brand
established by Tata Teleservices essentially to promote
and market their desktop Fixed Wireless Phones. These
Fixed Wireless Phones combined the advantages of both
G mobile phones and landline phones.
Further, clarification regarding Fixed Wireless Terminals
was issued vide this office letter No. 10-10/03-BS-llNol.VI
dated 23.03.2005 vide which it was clarified that the
Terminal used for Fixed Wireless Services should be strictly
H
TATA TELESERVICES LTD. v. BHARAT SANCHAR 355
'-· NIGAM LTD. AND ORS. [KAPADIA, J.]

confined to the premises of the subscriber where the A
telephone connection is registered. Separate levels within
allocated SDCA based link numbering scheme are to be
used forWireline and Fixed Wireless Services. Wherever
such restriction cannot be imposed, it shall be treated as
WLL (M) feature for all purposes. B
It is needless to mention that the word "Fixed" is clearly
understood and it does not require a separate definition
in legal or common parlance.

M/s TTSL submitted compliance to letter dated 23.03.2005 c
vide its replies dated 31.03.2005 stating that, "the Licensor
would surely be aware of the inherent "Soft handover"
nature of CDMA technology due to which CDMA terminals
(FW or mobile) utilize network and proving to be extremely
spectrally efficient Therefore, the implementation of any
D
restriction would require considerable changes to the
network, which need time, effort and considerable
resources to complete something that DoT requires to
provide. Nevertheless, under constraints of time, some
actions have been initiated which are detailed further in
this letter". Further vide letter dated 08.04.2005, Mis TTSL E
has stated that they have taken some exercise to restrict
service to the BTSs.

After examining all the responses of Mis Tata Teleservices
Ltd. on the above mentioned subject, it is noticed that F
initially, M/s Tata Teleservices Ltd. has not taken
appropriate steps to restrict the mobility within the
premises and has advertised such service where
consumer can have the impression that mobility 1s one of
the features. In the response also M/s TTSL stated that
G
fixed wireless phones combine the advantage of both
;- .
mobile and landhne phones. Moreover, the measures
taken, later on, to restrict the mobility has also been found
to be unsatisfactory. It is. therefore, clearly established
that mobility is not restricted to the premises and the
H
356 SUPREME COURT REPORTS [2008] 7 S.C.R.

A terminal cannot be treated as fixed terminal.
Whereas such services offered by Mis Tata Teleservices
Ltd. does not conform to the scope and character of the
fixed service and provide the character of Limited Mobile
Service.
B
Keeping in view the above, the competent authority has
decided that such services are to be treated as limited
mobile service within the scope of the licence.

This is without prejudice to any other action that may be
c taken by the Government in this regard.

Sd/- 2618105
(Sukhbir Singh)
Director (BS-II)
Tel. No.23036536
D
CC:
1. The Secretary, TRAI, Safdarjung Enclave, New Delhi.
2. Shri Rakesh Mehrotra, Chief Officer-Corporate Affairs,
M/s Tata Teleservices Ltd., lndicom Building, 2-A, Old
E
lshwar Nagar, Main Mathura Road, New Delhi-110065."
38. Analysing the directive dated 4.3.2005 issued by TRAI,
the point which arises for determination is whether such directive
is clarificatory or amendatory. According to TRAI, it is clarificatory
F whereas according to the appellants it is amendatory. In this
case, as stated above, we are concerned with the demand of
ADC on the appellants for the period 14.11.2004 to 26.8.2005.
According to the appellants, such a directive dated 4.3.2005
cannot operate retrospectively. This is the key issue which we
G need to decide. In this connection, it may be noted that the said
directive was issued to all access providers. The said directive
came to be issued as it was brought to the notice of TRAI that
new terminals were being deployed by access providers which
terminals do not have any fixed network access point physically
H located at the address of the subscriber. In the said circular dated
TATA TELESERVICES LTD. v. BHARAT SANCHAR 357
NIGAM LTD. AND ORS. [KAPADIA, J]

4.3.2005, TRAI noted that fixed wireless services were required A
to be provided through fixed wireless terminals with the location
of the network access point being fixed and with the end-user
terminal being connected to it. That, it had been brought to the
notice of TRAI that new terminals were being deployed by certain
~ access providers which did not possess fixed network access B
point physically located in the premises of the subscriber (PSR).
Therefore, by the said circular, TRAI directed the service
providers to strictly ensure that the terminal used for fixed
wireless services should strictly comply with premises
specification restriction, i.e., to the premises of the subscriber.c
This stipulation in the directive, according to the appellants,
constitutes a new requirement which has the effect of amending
the terms and conditions of the UAS licence as well as the
Telecommunication Interconnection Usage Charges Regulation
2003. The said directive dated 4.3.2005 stood followed by
D
... letters from DoT dated 23.3.2005 and 26.8.2005 .
39. In our view, there is no merit in the above contention
advanced on behalf of the appellants that the above directive
dated 4.3.2005 is amendatory and not clarificatory. The reasons
are as follows. E
40. Firstly, the UAS licence classifies wireless service into
three categories, namely full mobility, limited mobility and fixed
wireless access. As stated above, in FWA there is no mobility
of the User Device. FWA replaces copper lines to the homes of
the users by wireless links but without the benefit of mobility for F
the User Devices. FWA is one type of service. Mobility is a
service feature. In FWA system, the location of end-user terminal
and the network access point to be connected to end-user are
fixed. In circular dated 4.3.2005, TRAI has used certain
technological terms generally used in telecommunications like G
network access point, end-user terminal and fixed network
~
' ,.. access point. These terms find place in the generic requirement
formulated as far back as 1996. They also find place in the
Principles of Wireless Access formulated by ITU-RCA. Keeping
in mind the definitions given both in the technical references as H
358 SUPREME COURT REPORTS [2008] 7 SC R

A well as in the principles of wireless access formulated by ITU-
RCA. it is clear that Premises Specific Restriction ("PSR") is
not something new which stood evolved for the first time by
circular dated 4.3.2005. In substance, PSR emanates from
concepts, which are well known in telecommunications, both in
B technological references as well as in terms of generic
requirements and in terms of principles of wireless access. We
may state that broadly FWA is called WLL(F). As stated above,
the UAS Licence refers to three types of wireless services,
namely, full mobility, limited mobility and FWA. As stated, in
C FWA. the location of the end-user (Walky) and the network
access point (antenna connected to the end-user) are both fixed
whereas in the case of mobile wireless access, the location of
the end-user is mobile. WLL(M) is a hybrid between FWA and
MWA. Wireless access may be considered from many ••
perspectives. In this case, we are concerned with mobility
0
capabilities of the terminal: fixed, nomadic, mobile, restricted
+•
mobility etc. As stated hereinabove, the main purpose of FWA
[WLL(F))] is to provide network access to buildings through
exterior antennas communicating with Central Radio Base
Stations. In FWA. users in a building are allowed to connect to
E the network with conventional in-built networks. FWA is a serJice.
It is intended as a cheap cable replacement, without additional
features. Wireless systems differ depending upon the amount
of mobility that they allow for the users. FWA system is a
derivative of cordless phones. In FWA there is no mobility of the
F user devices. This is where the concept/principle of PSR
emerges. As stated above, there is a difference between
mobility and portability. A terminal may be portable but every
portable device is not mobile. Therefore, in our view, the
concnpts mentioned in circular dated 4.3.2005 issued by TRAI
G exist in telecommunications right from 2001. The said circular
merely clarifies and brings out the concept premises specific
restriction.
41. To sum up, in WLL(F) the telephone is the access
point if the antenna is in-built in the telephone. If the impugned
H
TATA TELESERVICES LTD. v. BHARAT SANCHAR 359
.., NIGAM LTD. AND ORS. [KAPADIA, J.]

service is operable throughout SOCA it is WLL(M). In WLL(F), A
location of end-user termination and the network access point
to be connected to the end-user are fixed. If the impugned
service cannot comply with PSR it is classifiable as WLL(M)
for IUC. AOC, Numbering Plan etc. Lastly, the only difference
~ between fixed wireline and WLL(F) is that WLL(F) is a cheap B
.. cable replacement wit~out additional features. WLL(F) is
limited to specific premises of the subscriber or permanent
location.

42. Secondly, the facts noted above indicate that the
classification of wireless service is done under the licence and c
based on that classification, chargeability for imposition of
interconnection usage charges and AOC is contemplated by
IUC Regulation of 2003. In other words, classification is done
by UAS licence followed by chargeability under !UC Regulation,
2003. Therefore, it would be wrong to say that vide circular dated D
4.3.2005 Walky has been reclassified as WLL(M) for the first
time by TRAI. If the concept of FWA embodies PSR and that
too from 2003 then it is clear that the said circular dated 4.3.2005
is clarificatory. It does not alter the terms and conditions of the
licence. As stated, FWA is one of the wireless services E
contemplated by UAS Licence which is dated July, 2003,
therefore, much prior to circular dated 4.3.2005 these concepts
were known to all access providers right from 2003. Therefore,
the said circular cannot be called as amendatory. It is purely
~ clarificatory in nature. F
43. Thirdly, as stated above, in this case we are concerned
with regulatory regime. ADC is a levy. Its levy depends on
mobility as a service feature. As stated above, the numbering
plan, radio frequency etc. are all importantelements of a network.
The numbering levels for fixed wireless services and for WLL(M) G
services are different. So also the numbering levels for fixed
... wireless service, limited mobility service and full mobility service
are different. The identification of the call whether originating
from mobile or from Walky or FWA has a correlation with the
numbering plan which is an important element of the network of H
360 SUPREME COURT REPORTS [2008] 7 S.C.R.

•
A the appellant in its MSC. For levy of ADC, integrity of numbering
plan is very important. In the present case, TRAI has detected
that the appellant is providing WLL(M) service in the garb of
fixed wireless phone service (FWA) which disturbs the integrity
of the numbering plan. It is important to note that in the case of
B full mobility, the rate is different as compared to the rate in the
case of limited mobility as compared to the rate in fixed wireless ,,.
service. This difference in the rates is spelt out in IUC Regulation,
2003. It is for this reason that even in the clarification issued by
DoT on 23.3.2005 that DoT had warned the access providers
c by pointing out that the issue of mobility has implication with
respect to the applicability of ADC. It was further clarified that if
it is not possible for the access provider to comply with the
requirement of PSR then the Walky services shall be treated as
WLL(M) service for all purposes including numbering plan,
interconnection usage charges, ADC etc. This is because a
D
separate level with allocated short distance charging area based ...
link numbering is to be used for wireline and fixed wireless
services. ADC is a levy. It is based on what is called as
recognition of services. Mobility is an important service feature.
The record indicates that right from 2003 when UAS licence
E stood issued the classification was contemplated by the
licensor-DoT when it categorized wireless service into full
mobility, limited mobility and FWA. ADC, interconnection usage
charges etc. follow that classification. IUC Regulation, 2003
imposes the statutory charges based on the classification in
F the licence. What is important in this case is that besides •
technological data, even as a matter of policy if there is a contract
between DoT and the access provider in terms of UAS licence
which provides for three categories then the levy of ADC would
depend upon the service which is rendered to the user by the
G access provider. In the circumstances, apart from technology,
this case is more on tax policy which levies ADC on services
which fall in the category of WLL(M). ,..
44. Fourthly, wireless systems differ in the amount of
mobility that they have to allow for the users. The ability to move
H
TATA TELESERVICES LTD. v. BHARAT SANCHAR 361
NIGAM LTD. AND ORS. [KAPADIA, J.]
....
around while communicating is one of the main features of A
wireless communication for the user. However, within that
requirement of mobility, different grades exist:
(i) Fixed Devices:
Fixed devices are placed only once. There is no B
~
mobility of the user devices in this grade. The main
object for using such devices lies in avoiding the
laying of cables. All wired communications fall also
in this category (example: PSTN).

(ii) Nomadic Devices: c
Nomadic devices are placed at a certain location for
a limited duration of time and then moved to a different
location. Laptops are typical example of nomadic
devices.
D
~-
(iii) Low Mobility:
Cordless phones are typical example of low mobility.
45. The point to be noted is that in the licence we have
three types of wirelss services, namely, limited mobility, full E
mobility and FWA. IUC levies the charge based on this
classification. ADC is a part of IUC. ADC is also levied under
IUC Regulation, 2003. In the case ofWalky, the instrument can
be put in the car, it can be carried throughout SDCA and Walky
calls can originate not only from the subscriber's premises but F
it can also originate from any point in the SDCA. Because of
this mobility, it is classifiable in the category of limited mobility.
As stated above, in the case of FWA [WLL(F)] there is no mobility
of the user device. When there is no such mobility of the user
device, it is similar to all wired communications. Therefore, FWA G
is categorized as WLL(F). All wired communications can also
fall in WLL(F) for the purposes of levy of ADC. However, since
~

~--.... - the user device in the case in hand is mobile throughout SDCA,
the services which the instrument Walky offers has to be
categorized as WLL(M) service. In the present case, we find
H
362 SUPREME COURT REPORTS [2008] 7 S.C.R

,._
A merit in the contention advanced on behalf of BSNL that the
appellants were providing WLL(M) services during the above
period in the garb of FWA or fixed wireless phone services and
thereby they have infringed the integrity of the numbering plan.
Therefore, ADC is payable by the appellants for the aforesaid
B period, namely, 14.11.2004 to 26.8.2005.
_,
46. Lastly, as stated above, classification of services stood
effected under UAS Licence 2003. Under the terms and
conditions of that licence, the access providers were required
to maintain the integrity of the numbering plan. This was one of
c the conditions of the licence. Similarly, classification/
categorization of wireless services was done under the licence.
The categorization constituted the term of the licence. As a matter
of follow-up for the purposes of levy of certain charges, including
AOC, !UC Regulation 2003 stood enacted. Under Section
D 11(1)(b) of the 1997 Act, the TRAI is empowered to ensure
compliance of terms and conditions of licence and to fix the ..,
terms and conditions of inter-connectivity between the service
providers [see: section 11 (1 )(b)(i) and (ii)] Similarly, under
Section 11(1)(c), TRAI is also authorized to levy fees and other
E charges at such rates and in respect of such services as may
be determined by regulations. In the present case, the IUC
Regulation, 2003 indicates by way of schedule the rate
chargeable for a call originating from mobile to fixed, fixed to
fixed, fixed to mobile etc. Under Section 13 of the 1997 Act,
F TRAI is empowered to issue directions from time to time to the
service providers for the discharge of its functions under Section
11 (1) of the 1997 Act. As stated above, the classification of the
three wireless services was done under the licence. The
clarification issued by TRAI on 4.3.2005 was under Section 13
of the 1997 Act. In the circumstances, the said clarification dated
G
4.3.2005 was issued by TRAI in accordance with law.
47. In our judgment, we have examined the nature of the
services, the status of the circulars issued by TRAI and the status
of the directive issued by Do T. The reasons given in our judgment
H are in addition to the reasons given in the impugned order dated
TATA TELESERVICES LTD. v. BHARAT SANCHAR 363
NIGAM LTD. AND ORS. [KAPADIA, J.]
A
9 9.2005 by TDSAT. We find no infirmity in the judgment of A
TDSAT.
48. Mr. Arun Jaitley, learned senior counsel for the
appellant, on the issue of Unilateralism submitted that when
the question - whether portable WLL(F) Phones should be
_,.
. treated alike as WLL(M) phones was pending before TRAI
pursuant to complaints from BSNL dated 4.1.2005, was it
B

open to TRAI to issue a directive as is done in this case on
4.3.2005 without waiting for a Determination by the
Competent Authority. In this connection reliance was placed
on paras 2.26 and 2.27 of the Consultation Paper. We find c
no merit in this argument. As stated above, directive dated
4.3.2005 is clarificatory and not amendatory. The context in which
the Consultation Paper emanated has been explained by us in
our Judgment in the Civil Appeal of Reliance lnfocomm Ltd ..
We do not wish to repeat the reasons herein once again. In any D
-1-" event, we have looked into technology aspect and policy
framework for levy of ADC hence there is no unilateralism as
alleged by the appellant.
49. Before concluding, one aspect needs to be
mentioned. It is alleged by the appellants and also by E
Reliance lnfocomm Ltd. in the conjoint appeal which we will
separately deal with in the subsequent judgment that BSNL
have also not disclosed their numbering levels for their fixed
wireless service and for their WLL(M) services which they
\,
have been providing during the relevant period in the name F
of "Tarang", which according to the appellants, would now
constitutes WLL(M) service. According to the appellants,
BSNL has also been providing fixed wireless phone services
which has limited mobility. This is a matter of quantification. That
stage has not yet arrived. However, Mr. Gopal Subramanium, · G
learned senior counsel appearing on behalf of BSNL, has fairly
stated that BSNL would abide by the parameters laid down in
our judgment and whatever adjustments required to be made in
that regard in the context of claims and counter claims, the same
shall be worked out in near future. Be that as it may, we express H
364 SUPREME COURT F<EPOR1 S

A no opinion on the point of quam1flcat1on which question did not
arise even before TDSAT in this case. Suffice 11 to state tt1at the
services of the appellants v1de the instrument Walky falls 1n the
category of WLL(M) service and, accordingly, the appellants
would be liable to pay ADC in that regard during the relevant
s period 14.11 2004 to 26.8 2005.
50. Accordingly, civil appeals stand dismissed with no "
order as to costs.

K.K.T Appeal dimissed

....