Vodafone India Fined Over Sales Promotion

The Delhi State Consumer Commission has imposed fines of Rs 50 lakh (US$117,300) on Vodafone India for resorting to "unethical" and "deceptive" trade practice by offering prizes to subscribers who call for more than 20 minutes in a day.

"We hold the telecom company guilty for indulging in a highly unfair trade practice affecting crores of subscribers...and employing deceptive methods to promote its business interest directly as well as indirectly," Commission President Justice J D Kapoor said.

Last year, the operator launched a marketing drive which offered entry into a prize draw with prized ranging from gold coins to a new car to customers who made calls exceeding 20 minutes per day.

In its defense, Vodafone had claimed that "The scheme is perfectly legitimate and cannot be termed as unfair trade practice as no extra money was charged from the subscribers,"

The Commission was not satisfied and said that the increased call revenues massively outweighed the value of the prizes on offer and broke regulations designed to prevent unfair trading practices.

Posted to the site on 19th May 2008