The Hindu Business Line : TRAI for taking mobile phones out of 1/6 scheme

THE Telecom Regulatory Authority of India (TRAI) has asked the Government to remove mobile phones from the `1/6 scheme,' which makes it mandatory for all mobile subscribers to file income-tax returns.

TRAI feels that if mobile phone subscribers are exempted from filing their returns, it will give a further impetus to the sector, which has already logged a 160 per cent growth in the last one year.

The TRAI Chairman, Mr Pradip Baijal, has written a letter to Mr Nripendra Misra, Secretary, Department of Telecommunications, pointing out that the mobile subscriber base increased from 13 million in March 2003 to 33.58 million subscribers in March 2004, thanks to greater affordability.

According to the latest TRAI figures, by the end of April 2004, the total number of mobile users in the country had reached about 35 million. It is further expected to rise to 100 million by December 2005.

"Owing to technological developments and a reduction in costs, the mobile phone has changed from being a product for the elite to that for a common man. TRAI has received representations from the service providers saying that the affordability of the service has attracted more and more low-end users. We are of the view that 1/6 Income-Tax criteria should exclude phones as that would facilitate growth in the sector," the letter says.

Another issue identified by TRAI relates to the cellular service operators not being allowed to offer pre-paid services in Jammu and Kashmir and the North-Eastern States on security grounds.

"Since pre-paid services contribute significantly towards the growth, this is seriously hindering the expansion of subscriber base in areas where tele-density is extremely low," the letter says.

TRAI has also suggested that roaming by pre-paid subscribers from other networks into these areas should also be allowed, subject to adequate security conditions being imposed on the operators.

The Government had, due to security reasons, disallowed pre-paid services and roaming by outside subscribers in these States after the attack on Parliament on December 13, 2002. It was found that the terrorists involved in the attacks had used pre-paid cards, prompting several policy measures to verify the identity of such subscribers.

As of now, only state-owned Bharat Sanchar Nigam Ltd offers mobile services in Jammu & Kashmir. But private operators Bharti and Reliance have also been granted licences and they are in the process of rolling out their services.

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TRAI for taking mobile phones out of 1/6 scheme