Telecom operator ordered to refund Rs2 billion to customers

The Islamabad High Court has upheld the Pakistan Telecommunication Authority’s (PTA) order for Pakistan’s digital and telecommunication service provider ZONG to refund more than Rs 2 billion to customers.

Justice Mian Gul Hassan Aurangzeb dismissed Zong’s appeal against the PTA order, directing it to refund Rs2,028,038,584 (more than 2 billion, 28 million rupees) collected from customers on account of service/maintenance/cards / operational fee charges from 26.04.2019 to 12.07.2019.

The court observed in its decision “Cellular mobile operators, including the appellant, had been charging Rs10 from customers each time they purchased and used a prepaid card valuing Rs.100/- as assistance/maintenance / administrative service charges”.

Justice Mian Gul Hassan Aurangzeb said that the Supreme Court, in its order, expressed that the service charges could not have been validly and legally imposed on the amounts loaded by users of mobile phone devices.”

IHC dismissed Zong’s appeal against the PTA decision calling it not maintainable.

According to the court order, PTA directed Zong to provide complete details of service/maintenance charges recovered from 24.04.2019 onwards.

It was reported that Zong had charged and collected Rs2,028,038,584 from its customers between 26.04.2019 and 12.07.2019 on account of service/maintenance/card / operational fee charges.

PTA directed Zong to refund the said amount to all its concerned subscribers in the form of a balance amount without any validity restriction.

Read More: Pakistan’s telecom sector raises concerns over heavy taxes

Earlier, Pakistan’s Telecom Operators Association expressed concerns over the heavy taxes slapped in budget 2024.

In a letter written to the Chairman of the Standing Committee on Finance, Salim Mandviwala, the Telecom Operators expressed concerns over the heavy taxes introduced in the budget.

The telecom sector has warned that foreign investment might withdraw from Pakistan if tax issues are not resolved. According to the telecom operators, unresolved tax issues could lead to legal complications for the government.

The letter highlights that two major market players have already decided to leave Pakistan. The telecom sector contributed PKR 340 billion in tax revenue last year, and has attracted direct investment of USD 15 billion to date, the letter stated.