The Supreme Court has partly allowed the Union Government’s appeal against Sistema Shyam Teleservices Ltd., holding that the telecom operator is liable to pay the reserve price fixed for the November 2012 2G spectrum auction from February 2, 2012, the date on which its licence stood quashed.
A Bench of Justice Sanjay Kumar and Justice K. Vinod Chandran ruled that the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) had erred in interpreting the Court’s earlier February 15, 2013 order as fixing the liability commencement date from that day. The Court clarified that its direction explicitly covered licensees who continued operations “after 02.02.2012,” making that the starting point for levy.
The dispute stemmed from the fallout of the landmark 2G spectrum judgment dated February 2, 2012, in Centre for Public Interest Litigation and others vs. Union of India and others, (2012) 3 SCC 1, which quashed several telecom licences, including that of Sistema. Though licences were invalidated, operators were temporarily allowed to continue services for 4 months to prevent disruption to the public. In February 2013, the Court directed that such operators must pay the reserve price set for the November 2012 auction if they continued operating.
TDSAT had limited Sistema’s liability from February 15, 2013, to April 30, 2013, in certain circles. The Supreme Court, however, rejected this interpretation, holding that: “The understanding of the TDSAT that this order did not indicate the ‘starting date’ is factually incorrect.”
The Court emphasised that the February 15, 2013, order clearly referred to licensees operating “after 02.02.2012,” leaving no scope for reinterpretation.
However, the Bench agreed with TDSAT on when Sistema’s liability should end. The Court held that for the eight circles where Sistema won fresh spectrum in the March 2013 auction, the company’s obligation to pay the reserve price ended on April 30, 2013, the date the government issued the Letter of Intent for the new licence. For the remaining circles, liability ended on March 23, 2013, when Sistema stopped operations.
On interest, the Court ruled that interest would be payable only from December 8, 2014, following expiry of the show-cause notice period, observing that the Department of Telecommunications could not benefit from its own delay.
“Having slept over the matter for that length of time, the DoT cannot take advantage of its own lassitude and seek to mulct upon the respondent interest liability for that period.”
Appearances
Appellant- Mr. Vikramjit Banerjee, A.S.G. Mr. Nachiketa Joshi, Sr. Adv. Mr. Apoorva Kurup, Adv. Mr. Navanjay Mahapatra, Adv. Mr. Aastha Singh, Adv. Mr. Abhishek Singh, Adv. Mr. Amrish Kumar, AOR Mr. Kartik Dev, Adv. Ms. Sanjana, Adv. Mr. Sahil Bhalotia, Adv. Mr. Rishav Raj, Adv.
Respondent- Mr. Gopal Jain, Sr. Adv. Mr. Mansoor Ali Shoket, Adv. Mr. Nitin Kala, Adv. Mr. Pukhrambam Ramesh Kumar, AOR Mr. Kunal Singh, Adv. Mr. Tannay Jain, Adv. Ms. Kanishka Rawat, Adv. Mr. Karun Sharma, Adv. Ms. Anupama Ngangom, Adv. Ms. Rajkumari Divyasana, Adv.z
