PURPOSE: To use an extension telephone set possible for direct call connection as an extension telephone set while keeping the function of a direct call telephone set by allowing the extension telephone set possible for direct call connection to be interrupted to a busy extension subscriber if an opposite party of the direct call is busy.

CONSTITUTION: The direct telephone call function is given to extension subscribers C, D and information of the telephone sets possible for direct call connection is stored in a storage device MEM. A central controller CCU discriminates it as the extension mutual connection when the extension subscriber C makes a dial within a prescribed time and discriminates it as the direct telephone call connection if the subscriber does not make a dial for a prescribed time or over. If the called party is busy, a busy tone is transmitted to the extension subscriber C and also the CCU makes connection possible for a hooking signal. When the extension subscriber C transmits a hooking signal, the central controller CCU discriminates it as interruption and brings the connection into the three-party talking state via a direct telephone call trunk HOT by using a path of the switch SW2.