2G scam: Supreme Court reserves order on cancellation of licences

Asserting that illegality cannot be protected, the Supreme Court on Thursday made it clear that licences of telecom companies would be cancelled if irregularities were detected in the allotment of the second generation mobile spectrum during the tenure of A Raja as it reserved its verdict on cancellation of 122 licences.

A bench of Justice GS Singhvi and Justice AK Ganguly rejected the companies claim that their contract with the government spectrum allotment cannot be quashed once it has been agreed upon, saying that the Principle of Estoppel does not protect illegality.

"No estoppel can be applied here. The principle cannot be applied to protect illegality," the bench said.

The court concluded its proceedings after hearing extensively from all the concerned companies, government and the petitioners.

In their joint petition, a group of civil societies, including an NGO Centre for Public Interest Litigation alleged that these allocation, made by the department of telecommunications (DoT) during the Raja's tenure as telecom minister, was marred by "multiple illegalities, corruption and favouritism".

The other petitioners in this case are telecom watchdog, Common Cause, former chief election commissioner JM Lyngdoh, TS Krishnamurthy and N Gopalaswami along with former central vigilance commissioner P Shankar.

They further submitted even the sectoral regulator Telecom Regulatory Authority of India (TRAI) has recommended cancellation of 69 out of the 122 licences as the licencees have failed to roll out their services in time as per one of the the conditions stipulated for grant of licences.

The bench had earlier issued notices to 11 private telecom companies, which were granted licences despite allegedly being ineligible to secure them or had failed to launch services within stipulated time-frame.

The private telecom companies which were issued notices included Etisalat, Uninor, Loop Telecom, Videocon, S-Tel, Allianz Infra, Idea Cellular, Tata Teleservices, Sistema Shyam Teleservices, Dishnet Wireless, Vodafone-Essar along with TRAI.

The telecom companies which have come under scrutiny for having benefited in 2G spectrum scam, however, refuted any illegality in allotment of spectrum and told the Supreme Court that allocation of the air waves since 2003 should be scrapped if the first-come-first-served policy adopted during Raja's tenure as telecom minister is to be held illegal.

The court proceeding in the case witnessed a virtual telecom war with the old service providers contending that spectrum alloted to them are valid and they should not be compared with new players whose licenses are under the judicial scrutiny.

Established companies Vodafone and Aircel opposed the contentions of Swan, Videocon, Shyam Telecom which had pleaded to the court that if it decides to cancel their allotment of spectrum, it should be applied  retrospectively from 1995 as the natural resources have been alloted under the same policy.