EVOLUTION OF LAWS GOVERNING TELECOM SECTOR IN INDIA:

AN ANALYSIS

OPTIONAL SUBJECT: INFRASTRUCTURE LAW

Submitted by:

Himanshu Solanki

UID: UG2018-35

B.A. LL.B.(Hons.) 5th Year- IX Semester

Submitted to:

Mr. Sumit Bamhore

(Assistant Professor of Law)

SESSION: 2022-23

MAHARASHTRA NATIONAL LAW UNIVERSITY, NAGPUR

 TABLE OF CONTENTS

I. INTRODUCTION....................................................................................................................1

II. AIMS & OBJECTIVES...........................................................................................................2

III. RESEARCH METHODOLOGY.........................................................................................2

IV. RESEARCH QUESTIONS..................................................................................................2

V. EVOLUTION OF TELECOMMUNICATION LAWS: PRE 1980 ERA...............................2

1. INDIAN TELEGRAPH ACT, 1885.....................................................................................2

2. WIRELESS TELEGRAPHY ACT, 1933 (The Act, 1933)..................................................3

3. THE TELEGRAPH WIRES (UNLAWFUL POSSESSION) ACT 1950............................4

VI. POST 1980s ERA.................................................................................................................4

1. THE TELECOM REGULATORY AUTHORITY OF INDIA ACT 1997..........................6

2. THE INFORMATION TECHNOLOGY ACT, 2000..........................................................7

3. DRAFT INDIAN TELECOMMUNICATION BILL, 2022................................................7

VII. REGULATORY AUTHORITIES:.......................................................................................9

VIII. ANALYSIS:.......................................................................................................................10

IX. CONCLUSION:.................................................................................................................11

X. BIBLIOGRAPHY AND REFERENCES:.............................................................................12

 I. INTRODUCTION

The term “telecommunication” is a combination of the Latin verb “communicare,” which means
“to share,” and the Greek prefix “tele,” which means “far off.” Currently, it refers to the
communication-related transmission of signals over a distance. In the beginning, people
communicated with each other using drumming, fire signaling, banners, etc. From such simple
origins, the means have evolved to include high-tech, underwater “optical cables” that are placed
on ocean floors as well as manufactured satellites that orbit the Earth. The frequency of
transmission has increased along with the need for communication systems.
Every element of our existence has been touched by the telecommunication services industry,
from the basic reality of permitting telephone conversation between individuals in various places
to the flawless operation of supply chains across hemispheres to produce goods and satisfy
consumer demand. “Telecommunications services” are increasingly acknowledged as a crucial
factor in the country’s economic reform and development as well as a crucial tool for a country’s
overall economic growth.
India’s introduction of “telegraph services” by the British East India Company in the 19th
century marked the beginning of telecommunications in that country. There are Telegraph Laws
which governed the past and current scheme around “Telecommunication” sector. However,
with time and advancement of technologies, they had gotten old. That is why under LPG
(Liberalization, Privatization and Globalization) private players were given entry to revive the
worn off industry. TRAI was established in 1997 to keep check on Department of
Telecommunication’s governance and decision. In presence of checks and balances through
regulatory bodies, the past two decades have been considered as the golden period for the
telecommunications industry in India with exponential growth and development in terms of
technology, penetration, as well as policy. It is exactly this legacy that Draft Telecommunication
Bills seeks to continue. With that in mind, researcher has traced the evolution of Telecom Law in
the remaining research paper.

1
 II. AIMS & OBJECTIVES
The aim of the researcher is to trace the evolution of Telecom laws, from the Indian Telegraph
Act, 1885 to the latest Draft Telecommunication Bill, 2021. The objectives of the researcher are:
1. To examine the role of government in regulating the Telecom Industry.
2. To find out the impact of LPG in changing the dynamics of Telecom Industry players.
3. To study the changes proposed by Draft Telecommunication Bill, 2021.

III. RESEARCH METHODOLOGY

The researcher has adopted ‘Doctrinal’ type of the methodology whereby primary and secondary
sources has been employed to gather information significant to the issue beforehand. Online
articles and research papers of different writers relating to the subject were taken into
consideration. Various judicial pronouncement has also been referred to present a thorough
picture. Reliable sources have been taken which holds certain authority to present the issue in a
way suitable to disseminate the evolution that the telecommunication laws have gone through.
The source of information also consists of the theoretical knowledge the researcher possesses as
a student of law.

IV. RESEARCH QUESTIONS

These were the questions researcher had in mind when doing the research:
1. What is the scope of control given to government to regulate the Telecom Industry?
2. What were the extent of participation allowed to private players before LPG?
3. How TRAI is different from DOT?
4. What does Draft Telecommunication bill aim to change?

V. EVOLUTION OF TELECOMMUNICATION LAWS: PRE 1980 ERA

1. INDIAN TELEGRAPH ACT, 1885
The “Telegraph Act” was created in 1883 with the goal of granting the Central Government the
authority to install “telegraph lines” on both private and public property. India still was governed
by the Britishers during this time. By putting an end to uprisings and gathering information, the
telegraph had grown into a crucial weapon for British domination in India. Consequently, it was
crucial for the British to preside over the subcontinent’s network and telegraphy. On October 1st
1885, the “Indian Telegraph Act” went into effect.

2
The Act, 1885 is the main legislation dealing with the “establishment, maintenance and working
of telegraphs” in the country. The term “telegraph” carries a wide scope under this Act. Section
3 of the Act defines the term “telegraph” to include “any appliance, instrument, material or
apparatus used or capable of use for transmission or reception of signs, signals, writing images,
and sounds or intelligence of any nature by radio waves, magnetic emissions, or Hertzian waves,
electric, galvanic or magnetic means.”1
The Act of 1885 gave the GOI absolute authority and entitlements for establishing, maintaining,
operating, licensing and supervision of all forms of “wired and wireless communications” within
Indian territory.2 The “wire-tapping” clause was also established by this Act. In accordance with
the relevant provision,3 the government has the authority to seize any licenced telegraphs in the
interest of “public safety” or in the event of a “public emergency.” Additionally, it directs
communication surveillance where doing so will protect India’s sovereignty and integrity state
security, cordial relations with other countries, civil order, or efforts to prevent instigation to
commit crimes. Nevertheless, in order to issue any such order, the government was required to
follow the legal process.
Additionally, the Telegraph Act of 1885 grants the Central Government the exclusive authority
to enact regulations governing the operation of any and all telegraphs set up, maintained, or
operated by the government or by individuals holding a valid license. 4 Additionally, it has the
authority to decide on the costs and other requirements that must be met for messages to be sent
both inside India5 and to any other territory.6 The Indian Telegraph Act 1885, while providing for
the regulation of the “establishment, operation and maintenance of a ‘telegraph’,” effectively
provides in The Union Government with the Right to enforce the provision of all
“telecommunication services” as each of them involves either the “establishment or working, or
operation and maintenance” of a ‘telegraph’.
2. WIRELESS TELEGRAPHY ACT, 1933 (The Act, 1933)
While attempting to govern “ownership” of “wireless communication apparatus,” the Wireless
Telegraphy Act of 1933 essentially governs every aspect of “wireless communication,” including

1
Section 3 of Telegraph Act, 1885.
2
Section 4 of Telegraph Act, 1885
3
Section 5 of Telegraph Act, 1885
4
Section 7(1) of Telegraph Act, 1885.
5
Section 7(2) of Telegraph Act, 1885.
6
Section 6A(1) of Telegraph Act, 1885.

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the use of frequencies and the location of wireless equipment in any telecommunications
network. No one is allowed to possess “wireless telegraphy equipment” without a license that
has been granted under the Act of 1933, unless they have been granted an exemption from its
terms by the Union Government.7 The Act 1933 designated the Telegraph Body established
under the Act of 1885 as the competent jurisdiction to issue licenses, and it is given the power to
review these licenses in the manner, subject to the requirements, and for the fees that may be
imposed.8
The framework established by the Act 1885 did not provide for the crucial element for
private sector involvement in the telecommunications sector, namely, laws to provide for a level
playing field with the incumbent operators, even though the Acts 1885 and 1933 do provide for
private participation in the “establishment, working, operation, and maintenance of telegraphs
and wireless telegraphy apparatus” by giving the authority to the Union Government to grant
licenses..9
3. THE TELEGRAPH WIRES (UNLAWFUL POSSESSION) ACT 1950
The “Indian Wireless Telegraph Act, 1933” was passed, making it illegal to possess “wireless
telegraphy equipment” unless you had a licence from the telecom authority. It also imposed fines
if you were found to be in possession of a “wireless telegraphy device” without a licence. There
are only 8 provisions to this brief piece of legislation that governs the ownership of “telegraph
wires.”
Even though telegraph services were totally discontinued in 2013, this statute, which imposes a
maximum five-year prison sentence for possessing copper telegraph wire, was recommended to
be repealed by the Law Commission on November 18, 2014.10

VI. POST 1980s ERA

The industry of telecommunications was governed by the Act of 1885. The government was in
responsible of developing policies and offering services under this Act. But in India, significant
telecommunications changes started in the 1980s. Since 1991, upwards of 5.5 percent of overall

7
Section 3 read with Section 4 of the Act, 1933.
8
Section 5 of the Act, 1933.
9
Piyush Joshi, “LAW RELATING TO INFRASTRUCTURE PROJECTS”, p. 427, 2001.
10
The Economic Times, “Repeal Law Related to Telegraph wire possession: Law Panel”. See:
https://economictimes.indiatimes.com/news/politics-and-nation/repeal-law-related-to-telegraph-wire-possession-
law-panel/articleshow/45192434.cms?from=mdr.

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spending has gone into communications, up from 3.6 percent under the Seventh Plan (1985–
1990). With the establishment of the “Center for Department of Telematics (C-DOT)” in 1984,
the first wave of telecom reforms got underway. A future era digital switching devices was being
developed by the autonomous organization known as C-DOT. For both urban and rural
applications, it has created a wide range of “switching and transmission” products.11
“Videsh Sanchar Nigam Limited (VSNL)” and “Mahanagar Telephone Nigam Limited (MTNL)”
were subsequently established in 1986. Then, in 1989, the “Telecom Commission” was
established. The “Telecom Commission” could indeed handle a variety of telecommunications-
related issues thanks to the “administrative and financial powers” of the GOI.12
The “National Telecom Policy 1994 (NTP)” declaration marked the commencement of
deregulation, the start of liberalization, and private sector involvement. The “basic” and the new
“cellular mobile” sections were open to private/foreign participants for the very first time during
NTP 1994. In certain areas, FDI up to 49% of total equity was also permitted. In each DoT
internal circle, the policy permitted one private service provider to compete in basic services
against the incumbent DoT. There were three established incumbents in the fixed service
industry, namely DoT, MTNL, and VSNL, when telecom restructuring started in 1994. With the
exception of Delhi and Mumbai, DoT operated in every region of the nation. While VSNL
offered international calling, MTNL ran operations in Delhi and Mumbai.13
NTP permitted duopoly in each circle’s cellular wireless services. Licenses were granted in
exchange for licensing payments as part of the implementation of the NTP of 1994 through a
bidding process. The Telecom Regulatory Authority of India (TRAI), was founded in 1997 as a
result of this policy. In order to maintain fair competition and safeguard consumer interests,
TRAI’s principal goal was to establish an appropriate “regulatory framework.”
Prior to the significant telecom developments, the DoT had a monopoly in the telecom sector due
to its existence throughout all of India and its ability to make policy. However, the service-
providing division of the DoT was divided and given the name “Department of Telecom Services
(DTS)” after the second round of reforms in 1999, which included reforming the DoT to create
a platform among private operators and the incumbent (DTS) for head to head competition.
Later, DTS changed its name to “Bharat Sanchar Nigam Limited (BSNL).” This implied a break
11
Manish Yadav & Anhita Tiwari, “Law Relating to Telecommunication Laws In India: An Overview,” p. 41,
Bharti Law Review (April-June, 2017).
12
Id. at 42.
13
Id. at 41.

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between the current service provider and the decision-maker. In general, DoT is now in charge of
formulating policies, issuing licenses, and promoting private investments in the production and
delivery of telecom services as well as telecom equipment. BSNL, a corporate entity, was in
charge of providing services at the time.14

1. THE TELECOM REGULATORY AUTHORITY OF INDIA ACT 1997

Private service providers’ entry into the market in 1992 inevitably brought with it the necessity
for autonomous governance. Thus, the Telecom Regulatory Authority of India Act, 1997 (TRAI
Act), formed TRAI with effect from February 20, 1997, to govern telecom services, including
the “fixation/revision of telecom service tariffs,” which had previously been under the DoT’s
jurisdiction.15
In order to maintain its autonomy from the government, TRAI has been given power. 16 The
responsibility for licencing remains with the government. The primary disagreement about
licencing has not been whether it should be handled by the regulator, but rather whether or not
consultations with TRAI should be a part of the terms and conditions of licencing in order to
maintain integrity in the auction process. The TRAI’s primary responsibilities involve setting
“telecom service tariffs,” resolving provider disputes, protecting consumers by keeping an eye on
service quality, ensuring that licence requirements are followed, and setting service goals and
pricing guidelines for all “operators and service providers.”17
The TRAI Act of 2000, which attempted to improve regulatory quality and restore functional
clarity, brought about additional modifications to the regulatory structure. “ A
Telecommunications Dispute Settlement and Appellate Tribunal (TDSAT)” was established to
take over the “adjudicatory and disputes functions” from TRAI, and the TRAI Act was amended
by an ordinance, which became effective on January 24, 2000. TDSAT was established to hear
and decide appeals against any directive, judgement, or order of TRAI as well as to settle
disputes between a “licensor and a licensee, between two or more service providers, and between
a service provider and a group of customers.”  The TDSAT was given the responsibility of
handling disputes in place of the TRAI as a result of this legislation.
14
Vikram Raghavan, “COMMUNICATIONS LAWS IN INDIA (LEGAL ASPECTS OF TELECOM,
BROADCASTING AND CABLE SERVICES),” p. 34, Lexis Nexis, 2007.
15
Id. at 12.
16
Id. at 38.
17
MS Ahluwalia, “STATE LEVEL PERFORMANCE UNDER ECONOMIC REFORMS IN INDIA,” p. 8, Center
for Research on Economic Development and Policy Reform, (Stanford University, 2001).

6
The case of Union of India v. TRAI18 gave rise to the requirement for TDSAT. In this instance,
the TRAI’s adjudicatory authority was contested on the grounds that, among other things, it
lacked the authority to command the DoT in its function as the “Licensor.” The Court
allowed the challenge, and the HC subsequently upheld it. The HC ruled, among other things,
that TRAI lacks the authority to provide the Government instructions while acting as the
Licensor. The TDSAT was established by legislative revisions, which gave it the jurisdiction
over the appeals against any instruction, decision, or order of the Authority (TRAI) as well as the
government.
2. THE INFORMATION TECHNOLOGY ACT, 2000
The Information Technology Act, 2000 was enacted by the Indian Parliament in 2000 and
revised in 2008 (the “ITA”). The amendment added several new sections on offences, including
“cyber terrorism and data protection,” and increased the emphasis on information security. The
ITA stipulates punishments for a variety of offences, including “pornography, impersonation
fraud, and cybercrimes.”  Despite the fact that the ITA was not specifically intended to apply to
the telecom industry, the 2008 amendments explicitly made the ITA is relevant to the telecom
industry due to the tight relationship between the information technology and telecom sectors.19
3. DRAFT INDIAN TELECOMMUNICATION BILL, 2022

The Act, 1885, the Act, 1933, and the Telegraph Wires (Unlawful Possession) Act, 1950
(cumulatively, the “Telegraph Laws”) are the three pieces of legislation that currently govern
“telecommunications” in India. On September 21, 2022, the DoT at the Ministry of
Communications, Government of India (“Government”) proposed to replace these laws with
the “Indian Telecommunication Bill, 2022 (Draft)”20 (“Draft Bill”).
This Draft Bill represents a significant beginning step in what is expected to be a rather lengthy
consultative process leading up to its implementation. It is based on a public consultation that
started in July 2022.
The accompanying explanatory note (“Explanatory Note”) outlines the goals of this measure,21
18
74 (1998) DLT 282.
19
Section 2(W) of the ITAA 2008 defines “Intermediaries” as follows: “Intermediary with respect to any particular
electronic records means any person who on behalf of another person received, stores or transmits that record or
provides any service with respect to that record and includes telecom service provider, internet service providers,
web hosting service providers, search engines, online payment sites, online auction sites, online market places and
cyber cafes”
20
Indian Telecommunication Bill, 2021 (Draft).
21
Explanatory note to the draft Indian Telecommunication Bill, 2022.

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which are to increase “digital inclusion, expand the telecommunications industry, and provide an
international telecommunication regime” that is prepared for the future.22 What does this Bill
bring to the table?
a) The “telecommunications law” aims to establish a legal framework to prevent the
exploitation of subscribers from unverified sources in terms of their security and safety.
b) The proposal specifies that before providing any “promotional services or
advertisements,” the customer’s explicit consent is required. Many people can anticipate
relief from the constant barrage of such uninvited intimations in this way, as India is
already among the countries that are most negatively impacted by spam calls
and messages.
c) The proposed law includes a right of appeal to the appellate authority. Additionally, a
different conflict resolution procedure, such as arbitration or mediation, may be
established by the central government.
d) The proposed measure also grants the federal government unquestionable authority. The
first is that any charge for any license holder or registered company under the rule may be
waived, in whole or in part. Second, it aims to reduce the TRAI watchdog role to that of a
recommendatory agency. Third, the given spectrum will revert to the control of the
central government if a telecommunications business that owns spectrum experiences
collapse or liquidation.
e) The draft also suggests that the “Telecommunication Development Fund (TDF)’ take the
role of the “Universal Service Obligation Fund (USOF)”. The TDF intends to improve
connectivity in underserved urban areas, skill development, etc., whereas the USOF Fund
has mostly been used to support countryside access.23
PLATFORMS FOR OTT:
a. One of the major adjustments is the addition of modern over-the-top messaging apps like
WhatsApp, Signal, and Telegram to the list of “telecommunications services.”
b. According to the proposed bill, telecommunication service providers will be subject to
the same licensing requirements as other telecom operators.
c. For years, “telecom service providers” have been fighting for a level playing field with

22
Id. at 2.
23
Arun Prabhu, Anirban Mohapatra & Soumya Tiwari, “The Draft Indian Telecommunication Bill, 2022: A Work in
Progress,” Cyril Amarchand Mangaldas, 27th September, 2022.

8
 “OTT apps” over communication services like voice calls and text messages because
operators had to pay high license and spectrum fees while OTT actors benefited from
their facilities to deliver service for free.

VII. REGULATORY AUTHORITIES:24

VIII. ANALYSIS:

There is general agreement that India’s transition to a “knowledge-based” economy will be

24
YADAV, supra note 11.

9
impossible without the rise of its IT and telecoms industries. While the IT industry has had
fantastic growth, the economic outlook of the telecom industry appears to have been stopped in
its tracks.25 The removal of the foreign investment prohibition and the Draft
Telecommunications Bill, 2021 in this sector, however, show that the Government appears to
have recognised the need for immediate measures to spur the expansion of the industry. It is
undeniable that India still has a long way to go before its growth rate catches up to that of other
established and developing countries. At a time when many other nations had already deployed
4G technologies, India was among the last nations to get access to 3G technology. There is a
catch, though, as India is still falling behind in the adoption of 5G technologies. India has built
its own 5G technology,26 which marks a significant milestone for the country. As a result, there is
still a long way to go until the government introduces laws, rules, recommendations, etc. that are
not only in the best interest interest of the government or the “telecom operators,” but also in the
best interest of the final customers, and that too without interruption. The Telecommunications
Bill, 2021, which includes provisions aimed at enabling a legal framework to stop user
mistreatment from suspicious links, also addresses this issue. The proposal states that before
providing any marketing solutions or advertisements, the customer’s explicit consent is required.
The requirement for versatility in the regulatory framework is another issue that requires rapid
attention. The current telecom legislation appears to be outdated, and the sector currently needs a
structure that can adapt to the changing needs of the sector. This is also addressed by the
Telecommunications Bill, which aims to include the Telegraph Laws to establish a more
straightforward legal framework but faces certain difficulties in doing so. The definition of
“telecommunications service”27 is as inclusive as it can be, including “services of any
description,” provided via “telecommunication.” Accordingly, a licencing regime will be in place
for not only activities that are best regulated through licencing, such as mobile and internet
services, but also for software platforms that use internet bandwidth, such as calling and
messaging services as well as services that transmit content (like software updates) to machines.
This type of software licensing is hardly ever done, and there has already been a lot of opposition

25
Nishith Desai Associates, “The Indian Telecom Sector: Legal and Regulatory Framework,” p. 36 (2014).
26
The Economic Times, “5G rollout: India would become the first country to deliver indigenous 5G, says Rajeev
Chandrasekhar.” See at: https://economictimes.indiatimes.com/industry/telecom/5g-rollout-india-would-become-
the-first-country-to-deliver-indigenous-5g-says-rajeev-chandrasekhar/articleshow/93306547.cms.
27
Section 2(21), the Draft Bill.

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to the idea.28
The Indian Telecommunications Bill, 2022 is a brave and encouraging move towards
“Atmanirbhar Bharat” in the telecom industry, even though there are some underlying
inconsistencies in the licensing system and most of the operational parts of the law would be
under the rules to be established. To secure the desired outcome, however, a number of
components of the Draft Bill need to be improved during consultation.

IX. CONCLUSION:

The history of the Indian telecommunications sector dates back to the country’s colonial era.
Telecommunications have changed over time from being a controllable object to a state
bureaucratic item to eventually being acknowledged as a crucial component and prerequisite of
India’s economic and social development. But the process of evolution has not been easy. India’s
socialist-leaning authorities led it on a course of import substitution and self-reliance at all costs
when it gained independence. Due to this, indigenous research, development, and innovation
were constrained by the environment. Huge state-run monopolies developed as a result of this
atmosphere. Despite the fact that the government acknowledged the futility of these attempts and
began along a path of liberalization, it has not been as successful as one might have thought
because of vested interests within the government and a system that were resistant to change.
Due to their desire to maintain their positions of authority, politicians frequently avoided taking
bold decisions. Up until recently, the legal system and its antiquated statutes (such as the Indian
Telegraphs Act of 1885) did not adapt to the new circumstances. The way the laws have been
interpreted has been, to put it mildly, complicated.
The Telecommunication Bill has redressed the deficiencies and outdates laws by giving a
futuristic outlook which stands to change the whole telecommunication industry. It will take its
ultimate shape over a period of time through discussions and meetings, but it is surely a positive
step in creating a contemporary framework.

28
PRABHU, supra note 23.

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X. BIBLIOGRAPHY AND REFERENCES:

- Articles:
1. MS Ahluwalia, “STATE LEVEL PERFORMANCE UNDER ECONOMIC REFORMS
IN INDIA,” p. 8, Center for Research on Economic Development and Policy Reform,
(Stanford University, 2001).
2. Manish Yadav & Anhita Tiwari, “Law Relating to Telecommunication Laws In India: An
Overview,” p. 44, Bharti Law Review (April-June, 2017).
3. Nishith Desai Associates, “The Indian Telecom Sector: Legal and Regulatory
Framework,” p. 36 (2014).
4. Arun Prabhu, Anirban Mohapatra & Soumya Tiwari, “The Draft Indian
Telecommunication Bill, 2022: A Work in Progress,” Cyril Amarchand Mangaldas, 27 th
September, 2022.
- Books:
1. Piyush Joshi, “LAW RELATING TO INFRASTRUCTURE PROJECTS.”
2. Vikram Raghavan, “COMMUNICATIONS LAWS IN INDIA (LEGAL ASPECTS OF
TELECOM, BROADCASTING AND CABLE SERVICES),” Lexis Nexis.
- E-resources:
1. http://www.wikipedia.org
2. http://www.trai.gov.in
3. http://www.dotindia.com
4. https://economictimes.indiatimes.com/

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