Interesting question, it's about three months old, viewed by 625 users (40 of which have this question too) and not a single reply - until now.
I'm not sure what the problem is. The poster says that he/she can hear the callers and the callers can hear him/her. This is usually indicative of a working phone.
Most people refer to a dial tone as the sound a landline uses to indicate that the telephone exchange is working. However, "Digital cellular telephone services, such as the GSM system, do not generate dial tones." - from Wikipedia. Here's a Wikipedia article: Dial tone - Wikipedia, the free encyclopedia.
Perhaps the poster was refering to the tones that the phone makes when dialing a number. This generally only happens when the Keypad is active in the Phone app and the the phone isn't in "Silent mode". These sounds are usually refered to as "Touch-Tone" (not dial tone). This is actually dual-tone multi-frequency signaling (DTMF). These sounds can be turned on by turning the ringer on (turning off silent mode). The "Ringer Volume" will control the volume of the Touch-Tone sounds.
(Or, perhaps the poster's statement was just an attempt at a joke?)