LexCENTRE FOR PUBLIC INTEREST LITIGATION AND OTHERS versus UNION OF INDIA AND OTHERS
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[2012] 3 S.C.R. 147 CENTRE FOR PUBLIC INTEREST LITIGATION AND A OTHERS v. UNION OF INDIA AND OTHERS (Writ Petition (Civil) No. 423 of 2010) FEBRUARY 2, 2012 [G.S. SINGHVI AND ASOK KUMAR GANGULY, JJ.] Telecommunications: 2G Spectrum - Allocation of - Under-pricing of spectrum based on theory of level playing field - Whether the recommendations made by the Telecom Regulatory Authority B c of India (TRAI) on 28.8.2007 for grant of Unified Access Service Licence (UAS Licence) with 2G spectrum in 800, 900 D and 1800 MHz at the price fixed in 2001 were contrary to the decision taken by the Council of Ministers on 31.10.2003 and whether the exercise undertaken by the Department of Telecommunications (DoT) from September 2007 to March 2008 under the leadership of the then Minister of C&IT for grant of VAS Licences to the private respondents in terms of E the recommendations made by TRAI was vitiated due to arbitrariness and malafides and was contrary to public interest - Held: While making recommendations on 28.8.2007, TRAI itself had recognised that spectrum was a scarce commodity - It, however, completely ignored that spectrum was to be F utilised efficiently, economically, rationally and optimally - The decision of the Council of Ministers in 2003 that the Do T and the Ministry of Finance should discuss and finalise the spectrum pricing formula was ignored by TRAI - The entire approach adopted by TRAI was lopsided and contrary to the G decision taken by the Council of Ministers and its recommendations became a handle for the then Minister of C&IT and the officers of the Do T who virtually gifted away the important national asset at throw away prices by willfully 147 H 148 SUPREME COURT REPORTS [2012] 3 S.C.R. A ignoring the concerns regarding fairness and transparency in spectrum allocation raised from various quarters including the Prime Minister, Ministry of Finance and also some of its own officers - This is also clear from the fact that soon. after obtaining the licences, some of the beneficiaries off-loaded B their stakes to others, in the name of transfer of equ/fy or infusion of fresh capital by foreign companies, and thereby made huge profits - There was no merit in the reasoning of TRAI that the consideration of maintaining a level playing field prevented a realistic reassessment of the entry fee - The C material produced clearly showed that the then Minister of C&IT wanted to favour some companies at the cost of Public Exchequer and took various steps to achieve same - In view of illegality of entire process, licences and spectrum a/location quashed - Costs of Rs 5 crores each imposed on parties 0 getting the' most undue benefit - Directions issued for regrant of licences and a/location spectrum in 2G band in 22 service areas by auction, as was done for a/location of spectrum in 3G band Central Government to consider recommendations of TRAI and take appropriate decision within next one month and fresh licences to be granted by E public auction - However, licences/spectrum granted previously through FCFS method i.e. between 2001 and 24.9.2007 not disturbed because said earlier cases were not questioned before this Court. F History of the growth of telecommunications in the country and the reforms introduced 1984 onwards - Discussed. New Economic Policy of India as announced on 24.7.1991; National Telecom Policy 1994 and National G Telecom Policy 1999 - Objectives of - Discussed. Constitution of India, 1950: Articles 38, 39, 48, 48A and 51A(g) - Natural resources - Concept of - Held: Even though there is no universally H accepted definition of natural resources, they are generally CENTRE FOR PUBLIC INTEREST LITIGATION & 149 ORS. v. UNION OF INDIA & ORS. understood as elements having intrinsic utility to mankind - A They may be renewable or non-renewable - They are thought of as the individual elements of the natural environment that provide economic and social services to human society and are considered valuable in their relatively unmodified, natural form - A natural resource's value rests in the amount of the B material available and the demand for it - .The latter is determined by its usefulness to production - Natural resources belong to the people but the State legally owns them on behalf of its people and from that point of view natural resources are considered as national assets, more so c because the State be
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