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New Delhi, February 2 (PTI): The Supreme Court on Thursday cancelled the 122 licences for 2G mobile telephony services granted in 2008 by the then telecom minister A Raja, and also imposed a fine of Rs 5 crore each on three companies that had offloaded shares after bagging the licences.
Ruling that the licences were issued in a “totally arbitrary and unconstitutional” manner, the court also directed the Telecom Regulatory Authority of India (TRAI), the sector’s regulator, to make fresh recommendations on the allocation of the licences.
Asking the government to take steps on the recommendations of TRAI within a month, a bench of justices G S Singhvi and A K Ganguly said the allocation of spectrum should be done via auction within four months.
The order came on petitions filed by CPIL, a non-governmental organisation, and Janata Party President Subramanian Swamy alleging a scam in the allocation of spectrum licences by Raja in January 2008 during the tenure of the first UPA government. The Comptroller and Auditor General of India had assumed a presumptive loss to the exchequer of up to Rs 1.76 lakh crore.
But the court refused to decide on a demand that it order the Central Bureau of Investigation to probe the alleged role of P Chidambaram, now the home minister, in the spectrum allocation scam. Swamy had contended that Chidambaram, then the finance minister, had a role in setting the prices for the licences, and in the dilution of shares by two telecom companies to foreign companies.
Disposing of the petitions filed by Swamy, the bench said the trial court should decide the matter within two weeks. The bench said their order should in no way influence the proceedings before the trial court.
Special CBI Judge P Saini, who is hearing a separate petition of Swamy to prosecute Chidambaram, has already reserved his order for February 4.
The 122 licences were given by Raja for a little over Rs 9,000 crore, while the government had raised Rs 69,000 crore from auctions of fewer licences for spectrum for third-generation (3G) mobile telephony services.
The companies that are set to lose on account of the cancellation of the licences are Uninor (joint venture between Unitech and Telenor of Norway), Loop Telecom, Sistema Shyam (joint venture between Shyam and Sistema of Russia), Etisalat DB (joint venture between Swan and Etisalat of UAE), S Tel, Videocon, Tatas and Idea.
Among the 122 licences issued by Raja in January 2008 on first-come first-serve basis, Uninor was alloted 22 pan India licences, Loop 21, Sistema-Shyam 21, Etisalat-DB 15, S Tel 6, Videocon 21, Idea nine and Tatas three.
Reacting to the Supreme Court judgment, Uninor, which has launched services in most of the circles, expressed shock and said it has been treated unfairly. “We have been unfairly treated as we simply followed the government process we were asked to. We are shocked to see that Uninor is being penalised for faults the court has found in the government process,” the company said.
Noting that the order has not stopped the company operations for now Uninor said “we expect the authorities to ensure that our 36 million customers, 17,500 workforce and 22,000 partners are not unjustly affected.”
Other new operators said that they would examine the order before commenting on the course of action.
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