Telcos fined 2,800cr for issuing ‘fake’ SIMs

New Delhi: The department of telecom has slapped penalties of Rs 2,800 crore on major telecom companies after at least 19 lakh SIM cards were found to have been issued by them on fake identity papers.      Under pressure, these telecom majors have started shedding the flab of lakhs of SIM cards obtained with fake identity papers and have already deposited Rs 400 crore with the government against the penalties raised against them for failing to  adhere to the know your customer (KYC) guidelines. The case involves one of the biggest penalties slapped on telecom companies and pertains to the period between 2007 and 2012.      The hefty penalty was imposed after TOI ran a campaign between 2007 and 2009 against SIM cards being procured on fake identity documents, some of which were used by terrorists to trigger blasts. When the government and telecom companies were in a denial mode, TOI procured two SIMs in the name of the then home secretary and then Intelligence Bureau director without having to deposit any proof of their identity. The two connections, a post-dated and another prepaid, were activated by the telcos without checking the veracity of the persons in whose name the connections had been issued and the records submitted as proof. Sistema sole bidder, CDMA auction fetches just 3,639cr T he government managed to raise just Rs 3,639 crore—less than one-tenth of the projection—on Monday when 800 MHz airwaves used for CDMA operations were auctioned. However, the sole bidder, Sistema Shyam Teleservices, will pay Rs 2,013 crore (deducting the Rs 1,626 crore paid earlier) in 10 annual instalments only from March 2016. P 19 Telcos challenge penalty system T hough initially the penalty amount imposed by DoT was Rs 1,000 for each SIM card obtained on fake identity papers, after 2009 the government raised it to a maximum of Rs 50,000 when huge discrepancies were discovered during scrutiny of customer application forms (CAF) of these telcos.      The maximum penalty was imposed on those telecom operators whose accuracy rate of correct proof of identity and address (PIA) was less than 80% of the total CAF checked. The telecom companies have, however, contested the graded system of penalty and have instead sought the government to impose penalty based on the income tax slab and that too retrospectively. Doing away with the graded system of penalty may bring down the current demand to 1/3rd of the penalties imposed. A Telecom Disputes Settlement and Appellate Tribunal order has also gone in favour of telecom companies which are seeking lowering of penalty.