State-owned BSNL has snapped connectivity with private telecom giant, Reliance Communications (RCom), due to non-payment of Interconnection Usage Charges (IUC) of around Rs 492 crore (including interest).

The dispute has been putting lakhs of subscribers to inconvenience and pertains to the period when the Ambani brothers were on a war path.

RIL chairman Mukesh Ambani then owned the company.

Sources said the discontinuation was initiated by the respective circles of the BSNL after Deputy General Manager (Regulation I), PC Sharma directed all Chief General Managers to take ‘action’ for recovery of outstanding dues.

Five days after Sharma’s letter, the Punjab Circle of the BSNL, to which Reliance Communication owes Rs 3 crore, snapped connectivity on April 25.

The issue of IUC had cropped up after international calls made from Reliance Communication network under WLL “unlimited Cordless” service were wrongly shown as local calls.

This was done by the service provider by allegedly tampering caller line identification. The alleged tampering reportedly caused heavy revenue losses to the government.

Sources said telecom tribunal TDSAT has given an interim order on April 18, 2011, in which it stated that entire principal amount along with 50% interest, be recovered from Reliance Communications within a week.

As the company did not pay, BSNL passed disconnection orders.

The interim order also states that interest is to be charged from Reliance from the date when it became due (when the amount become payable) and “demands raised by BSNL in respect of traffic handed over by Reliance through its basic service operator/ unified access service”.

The principal amount due to the BSNL is Rs 213 crore and interest is Rs 279 crore. The outstanding dues of other major circles are — Rs 33.39 crore (Gujrat), Rs 15 crore (Haryana), Rs 8 crore (Chennai), Rs 45 crore (Maharashtra)

Reliance has reportedly made partial payment in some circle, but details weren’t available.

When contacted local spokesperson of Reliance Communication, Rupesh Kumar, refused to comment on the plea that the matter was sub-judice.