SC receives presidential reference on 2G order

The SC had cancelled 122 telecom licences and held that an auction was the only route for allocating natural resources.

Published: 12th April 2012 07:41 PM  |   Last Updated: 16th May 2012 07:28 PM   |  A+A-

NEW DELHI: A presidential reference on whether the Supreme Court could interfere with a policy decision of the government and insist on auction as the only route for the allocation of natural resources was received by the apex court Thursday.

Among the questions raised in the reference is whether the court can set aside a policy decision of the government without appreciating the investments made by foreign entities under multilateral or bilateral agreements.

"Whether, if the court holds, within the permissible scope of judicial review, that a policy is flawed, the court is not obliged to take into account investments made under the said policy including investments by foreign investors under multilateral/bilateral agreements," is one of the queries raised.

"What is the permissible scope for interferences by the courts within the policy making by the government including method for the disposal of natural resources," is another question asked.

The presidential reference seeks clarity on several issues arising out of the apex court verdict of Feb 2, 2012, by which it had cancelled the 122 licences granted by the then telecom minister A. Raja and had held that the policy of first come first serve was "flawed" and an auction was the only route for allocating natural resources.

Of the 12 questions raised in the presidential reference seeking its opinion, it has asked whether auctioning was the only permissible method for the disposal of all natural resources across all sectors and in all circumstances.

The reference also asks whether following the auction route only for disposal of natural resources was not contrary to several judgments of the Supreme Court, including those of larger benches.

The presidential reference while giving the background asked what would be the fate of earlier licences granted in 1994 and 2001 and between 2003-2007 on the basis of first come first serve policy.

The presidential reference further said that in view of the court's reasoning and finding that the natural resources of the state must be auctioned, doubts have now arisen, inter alia, regarding the pricing of the spectrum historically granted to the earlier licencees and how that should be dealt with.

One of the questions sought to be addressed by the court is whether the enunciation of broad principles by the court did not amount to formulation of a policy that has the affect of unsettling the policy decision taken by the successive governments over the years for the development of various sectors of the economy.

Having raised the legal issues, the presidential reference asks whether in the wake of the 2G verdict the licences granted in 1994, 2001 and 2003-2007 would be affected, and whether dual technology licences issued in 2007 and 2008 would be affected.

Another question that the presidential reference seeks the apex court's answer is whether in the wake of 2G verdict, the government should withdraw the spectrum allocated to all the existing licencees or they should be asked to pay for the same price from retrospective effect and if so then on what basis and from what date.

In another three clarifications, the presidential reference has sought the court's clarification whether it could make provision for allocation of spectrum from time to time at the auction determined price.

The court has also been asked to consider if there could be a ceiling on the acquisition of spectrum in order to avoid dominance of the market by any telecom operator. It also asked the court to clarify whether it could make provision for allocation of spectrum at auction related prices in accordance with the laid down criteria in bands where there may be inadequate or no competition.

Finally, the presidential reference has sought to know what would be affect of the 2G verdict on 3G Spectrum acquired by the entities by auction whose licences have been quashed by the said judgment.


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