IndiaMART Approaches Delhi HC Seeking To Quash TRAI’s Spam SMS Regulations

B2B ecommerce platform IndiaMART has filed a petition with the Delhi High Court seeking to repeal the Telecom Regulatory Authority of India (TRAI’s) new rules to prevent spam and fraudulent SMSes.

On February 28, 2021, TRAI had implemented a new set of regulations that had directed telecom companies to institute a distributed ledger technology (sic blockchain tech) to verify and track commercial SMSes. 

According to a Mint report on Monday, the NSE-listed company has termed TRAI’s new spam filtering rules applicable on telemarketers and telecom companies as “unconstitutional”. The report added the case will be due for a hearing next Monday.

TRAI’s regulation mandated telcos to track registration of telemarketers, and meta-data such as headers, content templates, consent templates, registration of fine-grained subscriber preference etc. 

The blockchain technology to curb fraudulent and fake SMSes, referred to as Unsolicited Commercial Communication (UCC) by the TRAI was originally envisioned in the Telecom Commercial Communications Customer Preference Regulations, (TCCCPR) that was notified in 2018. 

Under the TCCCPR regulations, telcos were directed to keep a record of commercial message senders referred to as principal entities (PEs) by the TRAI. 

However, IndiaMART in its petition to the high court claimed that the TRAI should differentiate between commercial and non-commercial recipients and subscribers on its TCCCPR regulations. Since TCCCPR regulations also applied to both B2C and B2B messages, IndiaMART claimed that telecom regulators do not have the power to regulate SMS communication between two private businesses. 

“It is submitted that the 2018 regulation fails to draw any distinction between commercial subscriber/recipient and ordinary subscriber/recipient and, therefore, the regulations are violative of Article 14, 19 ( 1 )(g) and 21 of the Constitution since it does not recognize reasonable classification and treats unequals equally,” Indiamart said in its petition. 

IndiaMART’s petition also comes shortly after TRAI decided to suspend the nationwide rollout of the TCCCPR guidelines that were implemented on 28th February. Days after telcos and other telemarketers scrambled to comply with new regulations, the blockchain system that was supposed to curb spam SMSes caused massive disruptions in UPI payments in the first week of March.    

Following the disruption on UPI payments, and delay in OTP messages for users, the implementation of the blockchain system was suspended for a period of seven-days after discrepancies were found in the onboarding process of PEs, TRAI said in a notification on March 9th.

The need to curb the menace of SMS spam and fraudulent SMSes was underlined during a recent high-level meeting chaired by the Information Technology (IT) Minister Ravi Shankar Prasad. During the meeting, it was decided that a web/mobile application and an SMS-based system would be devised to enable telecom subscribers to lodge their complaints related to matters involving UCC.

In November last year, India’s telecom regulator had fined eight leading Indian telecom companies including Bharat Sanchar Nigam Ltd (BSNL), Reliance Jio, Mahanagar Telephone Nigam Ltd (MTNL), Videocon and Tata Teleservices INR 35 Cr collectively for failing to clamp down on fake SMSes. The brunt of the fine was borne by BSNL, which was asked to pay a penalty of INR 30.1 Cr.