http://www.thehindu.com/multimedia/archive/00911/Supreme_Court_verdi_911309a.pdf
*******d. On 17.10.2007, the Minister of C&IT accepted the recommendations of the Telecom Commission and thereby approved the recommendations made by TRAI. However, neither the Internal
Committee of the DoT and the Telecom Commission nor the Minister of C&IT took any action
in terms of paragraph 2.40 of the recommendations wherein it was emphasised that the
existing spectrum allocation criteria, pricing methodology and the management system suffer
from a number of deficiencies and the whole issue should be addressed keeping in view
issues linked with the spectrum efficiency and its management. The DoT also did not get in
touch with the Ministry of Finance to discuss and finalise the spectrum pricing formula which
had to include incentive for efficient use of spectrum as well as disincentive for sub-optimal
usage in terms of the Cabinet decision of 2003*********************
******************While approving the note, the Minister of C&IT on his own recorded the following– "LoI may be issued to the applicants received upto 25th Sept. 2007". Simultaneously, he sent
D.O. No.20/100/2007-AS.I dated 2.11.2007 to the Prime Minister and criticised the
suggestion made by the Law Minister by describing it as totally out of context.******************
**********************888The Minister of C&IT did not bother to consider the suggestion made by the Prime
Minister, which was consistent with the Constitutional principle of equality, that keeping in
view the inadequate availability of spectrum, fairness and transparency should be maintained
in the allocation of spectrum, and within few hours of the receipt of the letter from the Prime
Minister, he sent a reply wherein he brushed aside the suggestion made by the Prime
Minister of ensuring fairness and transparency by saying that it will be unfair, discriminatory,
arbitrary and capricious to auction the spectrum to new applicants as it will not give them a
level playing field**********************
*************************835. Although, the record produced before this Court does not show as to when the principle
of first-come-first-served was distorted by the Minister of C&IT, in an apparent bid to show
that he had secured Prime Minister's approval to this act of his, the Minister C&IT sent letter
dated 26.12.2007 to the Prime Minister, paragraphs 1 and 2 of which are extracted below:
"1. Issue of Letter of Intent (LOI): DOT follows a policy of First-cum-First Served for granting
LOI to the applicants for UAS licence, which means, an application received first will be
processed first and if found eligible will be granted LOI.
2. Issue of Licence: The First-cum-First Served policy is also applicable for grant of licence
on compliance of LOI conditions. Therefore, any applicant who complies with the conditions of LOI first will be granted UAS licence first. This issue never arose in the past as at one
point of time only one application was processed and LOI was granted and enough time was
given to him for compliance of conditions of LOI. However, since the Government has
adopted a policy of "No Cap" on number of UAS Licence, a large number of LOI's are
proposed to be issued simultaneously. In these circumstances, an applicant who fulfils the
conditions of LOI first will be granted licence first, although several applicants will be issued
LOI simultaneously. The same has been concurred by the Solicitor General of India during
the discussions."************************
..................Here comes the crucial point
40.All the applicants including those who were not even eligible for UAS Licence collected
their LoIs on 10.12.2008. The acceptance of 120 applications and compliance with the terms
and conditions of the LoIs for 78 applications was also received on the same day.
for which the answer supplied to the court is"The UAS Licences were given strictly in accordance with the modified first-come-firstserved policy. That the respondents were able to fulfil LoI conditions because newspapers had already published stories about the possible grant of licences in the month of January,
2008. That those who had made applications in 2004 and 2006 cannot be clubbed with those
who had applied in the month of August and September, 2007 because in terms of the
existing UASL guidelines they were entitled to licences...........
then, this argument of the petitioner.....Shri Bhushan pointed out that the recommendations made by TRAI on 28.8.2007 were
contrary to public interest as well as financial interest of the nation because at the time of
entry of 4th cellular operator the same TRAI had suggested multi-stage bidding and even for
allocation of 3G spectrum the methodology of auction was suggested but, for no ostensible
reason, the so-called theory of level playing field was innovated for grant of UAS Licences in
2007 on the basis of the entry fee fixed in 2001. Learned counsel emphasized that the
transfer of equity by three of the licensees immediately after issue of licences for gain of
many thousand crores shows that if the policy of auction had been followed, the nation would
have been enriched by many thousand crores..............
{as for the revision of cutoff date, while the situation has been described as unprecedented, the action of advancing the cutoff date will also be a concomitant act...this is what those with common sense can infer.}
the petitioner argument is ....The decision of the Minister to pre-pone the cut-off date from 1.10.2007 to 25.9.2007, which eliminated large number of applications, is violative of Article 14 of the Constitution
and the entire exercise undertaken with reference to this cut-off date has resulted in
discrimination vis-à-vis other eligible applicants................
the answer to the court is...........49. Shri G.E. Vahanvati, learned Attorney General referred to NTP, 1994 and NTP, 1999 and
submitted that the policy decision taken by the Government of India for private sector
participation, which could bring in the funds required for expansion of telecommunication
services in different parts of the country, cannot be scrutinized by the Court. He submitted
that in the last more than 20 years the telecom services have expanded beyond anybody's
expectation because of private sector participation and it cannot be said that granting UAS
Licences by charging the entry fee determined at 2001 prices is unconstitutional. Learned
counsel referred to the history of development in the field of telecommunications and the
concept of spectrum, and submitted that the policy decision taken by the DoT for migration of
CDMA service providers was neither illegal nor unconstitutional. Shri Salve pointed out that
Tata Teleservices had sent an application through fax for grant of GSM for the existing
licences which were granted on 19.10.2007 and no exception can be taken to this because
Reliance Telecom which had applied for GSM on 6.2.2006 was given the benefit of migration
to dual technology on 18.10.2007 even before the policy was made public. Learned senior
counsel argued that the decision not to auction UAS licences was based on the
recommendations of TRAI and as the petitioners have not challenged the recommendations
for two years, the exercise undertaken by the DoT for grant of UAS licences in 2008 and
subsequent allotment of spectrum should not be nullified. In the end, Shri Salve argued that
the question of institutional integrity is involved in the matter and if the Court comes to the
conclusion that auction is the only method for grant of licences and allocation of spectrum
then everything should be annulled right from 2001. He submitted that multi-stage bidding
was done only for the purpose of entry of 4th cellular operator but, thereafter, no auction was held. Learned senior counsel submitted that if the spectrum was allotted free of charge till
2007 and, therefore, there could be no justification for auction of licences or spectrum in
2007.........................
the court states..57...Before dealing with the arguments of the learned counsel for the parties and adverting to
some of the precedents, we consider it necessary to mention that during the course of
hearing. Shri Prashant Bhushan and Dr. Subramanian Swamy heavily relied upon the CAG
report as also the One Man Committee Report. Learned Attorney General and learned senior
counsel appearing for some of the private respondents also referred to the One Man
Committee Report. However, as the CAG report is being examined by the Public Accounts
Committee and Joint Parliamentary Committee of Parliament we do not consider it proper to
refer to the findings and conclusions contained therein. Likewise, we do not consider it
necessary to advert to the observations made and the suggestions given by the One Man
Committee because the Government of India has already taken a decision to segregate the
spectrum from licence...............
the court states.....71. The argument of Shri Harish Salve, learned senior counsel that if the Court finds that the
exercise undertaken for grant of UAS Licences has resulted in violation of the institutional
integrity, then all the licences granted 2001 onwards should be cancelled does not deserve
acceptance because those who have got licence between 2001 and 24.9.2007 are not
parties to these petitions and legality of the licences granted to them has not been
questioned before this Court....................
without even going into the reasons given by the court, the sure impression that one gets, is that this judgement strays everywhere, and wrecks everything....the entire system is bent to the will of the court...
if this judgement is not challenged, analysed and rewritten, the onset of paralysis of the system can be detected.
*******d. On 17.10.2007, the Minister of C&IT accepted the recommendations of the Telecom Commission and thereby approved the recommendations made by TRAI. However, neither the Internal
Committee of the DoT and the Telecom Commission nor the Minister of C&IT took any action
in terms of paragraph 2.40 of the recommendations wherein it was emphasised that the
existing spectrum allocation criteria, pricing methodology and the management system suffer
from a number of deficiencies and the whole issue should be addressed keeping in view
issues linked with the spectrum efficiency and its management. The DoT also did not get in
touch with the Ministry of Finance to discuss and finalise the spectrum pricing formula which
had to include incentive for efficient use of spectrum as well as disincentive for sub-optimal
usage in terms of the Cabinet decision of 2003*********************
******************While approving the note, the Minister of C&IT on his own recorded the following– "LoI may be issued to the applicants received upto 25th Sept. 2007". Simultaneously, he sent
D.O. No.20/100/2007-AS.I dated 2.11.2007 to the Prime Minister and criticised the
suggestion made by the Law Minister by describing it as totally out of context.******************
**********************888The Minister of C&IT did not bother to consider the suggestion made by the Prime
Minister, which was consistent with the Constitutional principle of equality, that keeping in
view the inadequate availability of spectrum, fairness and transparency should be maintained
in the allocation of spectrum, and within few hours of the receipt of the letter from the Prime
Minister, he sent a reply wherein he brushed aside the suggestion made by the Prime
Minister of ensuring fairness and transparency by saying that it will be unfair, discriminatory,
arbitrary and capricious to auction the spectrum to new applicants as it will not give them a
level playing field**********************
*************************835. Although, the record produced before this Court does not show as to when the principle
of first-come-first-served was distorted by the Minister of C&IT, in an apparent bid to show
that he had secured Prime Minister's approval to this act of his, the Minister C&IT sent letter
dated 26.12.2007 to the Prime Minister, paragraphs 1 and 2 of which are extracted below:
"1. Issue of Letter of Intent (LOI): DOT follows a policy of First-cum-First Served for granting
LOI to the applicants for UAS licence, which means, an application received first will be
processed first and if found eligible will be granted LOI.
2. Issue of Licence: The First-cum-First Served policy is also applicable for grant of licence
on compliance of LOI conditions. Therefore, any applicant who complies with the conditions of LOI first will be granted UAS licence first. This issue never arose in the past as at one
point of time only one application was processed and LOI was granted and enough time was
given to him for compliance of conditions of LOI. However, since the Government has
adopted a policy of "No Cap" on number of UAS Licence, a large number of LOI's are
proposed to be issued simultaneously. In these circumstances, an applicant who fulfils the
conditions of LOI first will be granted licence first, although several applicants will be issued
LOI simultaneously. The same has been concurred by the Solicitor General of India during
the discussions."************************
..................Here comes the crucial point
40.All the applicants including those who were not even eligible for UAS Licence collected
their LoIs on 10.12.2008. The acceptance of 120 applications and compliance with the terms
and conditions of the LoIs for 78 applications was also received on the same day.
for which the answer supplied to the court is"The UAS Licences were given strictly in accordance with the modified first-come-firstserved policy. That the respondents were able to fulfil LoI conditions because newspapers had already published stories about the possible grant of licences in the month of January,
2008. That those who had made applications in 2004 and 2006 cannot be clubbed with those
who had applied in the month of August and September, 2007 because in terms of the
existing UASL guidelines they were entitled to licences...........
then, this argument of the petitioner.....Shri Bhushan pointed out that the recommendations made by TRAI on 28.8.2007 were
contrary to public interest as well as financial interest of the nation because at the time of
entry of 4th cellular operator the same TRAI had suggested multi-stage bidding and even for
allocation of 3G spectrum the methodology of auction was suggested but, for no ostensible
reason, the so-called theory of level playing field was innovated for grant of UAS Licences in
2007 on the basis of the entry fee fixed in 2001. Learned counsel emphasized that the
transfer of equity by three of the licensees immediately after issue of licences for gain of
many thousand crores shows that if the policy of auction had been followed, the nation would
have been enriched by many thousand crores..............
{as for the revision of cutoff date, while the situation has been described as unprecedented, the action of advancing the cutoff date will also be a concomitant act...this is what those with common sense can infer.}
the petitioner argument is ....The decision of the Minister to pre-pone the cut-off date from 1.10.2007 to 25.9.2007, which eliminated large number of applications, is violative of Article 14 of the Constitution
and the entire exercise undertaken with reference to this cut-off date has resulted in
discrimination vis-à-vis other eligible applicants................
the answer to the court is...........49. Shri G.E. Vahanvati, learned Attorney General referred to NTP, 1994 and NTP, 1999 and
submitted that the policy decision taken by the Government of India for private sector
participation, which could bring in the funds required for expansion of telecommunication
services in different parts of the country, cannot be scrutinized by the Court. He submitted
that in the last more than 20 years the telecom services have expanded beyond anybody's
expectation because of private sector participation and it cannot be said that granting UAS
Licences by charging the entry fee determined at 2001 prices is unconstitutional. Learned
counsel referred to the history of development in the field of telecommunications and the
concept of spectrum, and submitted that the policy decision taken by the DoT for migration of
CDMA service providers was neither illegal nor unconstitutional. Shri Salve pointed out that
Tata Teleservices had sent an application through fax for grant of GSM for the existing
licences which were granted on 19.10.2007 and no exception can be taken to this because
Reliance Telecom which had applied for GSM on 6.2.2006 was given the benefit of migration
to dual technology on 18.10.2007 even before the policy was made public. Learned senior
counsel argued that the decision not to auction UAS licences was based on the
recommendations of TRAI and as the petitioners have not challenged the recommendations
for two years, the exercise undertaken by the DoT for grant of UAS licences in 2008 and
subsequent allotment of spectrum should not be nullified. In the end, Shri Salve argued that
the question of institutional integrity is involved in the matter and if the Court comes to the
conclusion that auction is the only method for grant of licences and allocation of spectrum
then everything should be annulled right from 2001. He submitted that multi-stage bidding
was done only for the purpose of entry of 4th cellular operator but, thereafter, no auction was held. Learned senior counsel submitted that if the spectrum was allotted free of charge till
2007 and, therefore, there could be no justification for auction of licences or spectrum in
2007.........................
the court states..57...Before dealing with the arguments of the learned counsel for the parties and adverting to
some of the precedents, we consider it necessary to mention that during the course of
hearing. Shri Prashant Bhushan and Dr. Subramanian Swamy heavily relied upon the CAG
report as also the One Man Committee Report. Learned Attorney General and learned senior
counsel appearing for some of the private respondents also referred to the One Man
Committee Report. However, as the CAG report is being examined by the Public Accounts
Committee and Joint Parliamentary Committee of Parliament we do not consider it proper to
refer to the findings and conclusions contained therein. Likewise, we do not consider it
necessary to advert to the observations made and the suggestions given by the One Man
Committee because the Government of India has already taken a decision to segregate the
spectrum from licence...............
the court states.....71. The argument of Shri Harish Salve, learned senior counsel that if the Court finds that the
exercise undertaken for grant of UAS Licences has resulted in violation of the institutional
integrity, then all the licences granted 2001 onwards should be cancelled does not deserve
acceptance because those who have got licence between 2001 and 24.9.2007 are not
parties to these petitions and legality of the licences granted to them has not been
questioned before this Court....................
without even going into the reasons given by the court, the sure impression that one gets, is that this judgement strays everywhere, and wrecks everything....the entire system is bent to the will of the court...
if this judgement is not challenged, analysed and rewritten, the onset of paralysis of the system can be detected.
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