Consumer courts cut off from telecom disputes

In a significant judgment in General Manager, Telecom v M Krishnan & Anr the Supreme Court recently ended the jurisdiction of consumer courts to entertain disputes relating to telecom services, including telephone service charges, holding that from now on these disputes should be resolved through arbitration provided for under section 7B of the Indian Telegraph Act, 1885.

The dispute in this case was over non-payment of service charges for the telephone connection provided to Krishnan by Bharat Sanchar Nigam (BSNL), and the subsequent disconnection of the service by BSNL due to the non-payment. Aggrieved by the disconnection, Krishnan filed a complaint before Kozhikode district consumer forum, which directed BSNL to reconnect the telephone service and pay compensation of Rs5,000 (US$103) plus interest to Krishnan. Writ petitions filed by BSNL challenging this order were dismissed by the single and then the full bench of Kerala High Court. BSNL then challenged these dismissals before the Supreme Court.

Allowing BSNL’s appeal, the two-judge bench of the Supreme Court set aside the concurrent findings of the district consumer forum and of the single bench and division bench of the high court, and ordered that henceforth all phone disputes would be decided through arbitration under the 124-year-old Telegraph Act.

The update of court judgments is compiled by Bhasin & Co, Advocates, a corporate law firm based in New Delhi. The authors can be contacted at lbhasin@bhasinco.in, lbhasin@vsnl.com or lbhasin@gmail.com. Readers should not act on the basis of this information without seeking professional legal advice.