The Government will soon file a petition to review the landmark Supreme Court verdict on 2G licences, but stop short of questioning the directions on quashing of 122 licences and allocation of spectrum. The review plea, instead, will challenge the apex court's ruling that auction is the only fair route to allocate natural resources as also its finding that the Government's First Come First Served (FCFS) policy was flawed, according to top Government sources.
This keeps the new operators in the game because, if the court agrees to review its own order, operators such as Telenor and Sistema can hope to get their licences back through the FCFS route again. It also makes life easier for incumbent players whose licences were allocated through the FCFS policy.
First-come-first-served
The Government's review petition will argue that auctioning 2G spectrum, as ordered by the court, would affect the Government's policy objectives while the FCFS policy had, in fact, helped increase tele-density and made wireless services affordable.
The auction method may put more financial pressure on new players that will have to pay much more to acquire licence and spectrum, the sources said. Therefore, they added, it is unlikely that new players will penetrate virgin markets and offer consumers services at a competitive cost.
Significantly, the Government has found 24 grounds on which the apex court has erred in law. The petition will question the Supreme Court getting ‘engaged' in policy making, which, the Government says, lies with the executive, even according to earlier court rulings. The main ground is the apex court's insistence on auctioning the 2G airwaves. “The judgment erred in holding that a public auction is the only fair and transparent method by which the State can distribute natural resources,” the sources said.
The judgment erred in finding that the FCFS policy involves ‘an element of pure chance or accident', without considering that there is a risk that any policy, including sale by public auction, may be wrongfully implemented, they claimed.
Interestingly, the judgement is contradictory as, though it considered the FCFS policy flawed, it did not adhere to the principles of equality. However, the ruling acknowledges that the policy was based on the twin principles of creating a level playing field among telecom players as well as promoting affordability and increasing the penetration of wireless services in semi-urban and rural areas, both of which promote the equality principle, the sources pointed out.
Tata Tele seeks review of verdict
Tata Teleservices Ltd has moved the Supreme Court seeking review of the judgment cancelling its licences for the 2G spectrum in three circles which were allotted during the tenure of former Telecom Minister, Mr A Raja. The petition seeking review was filed nearly a month after the apex court on February 2 had cancelled 122 licences granted to nine telecom companies, including Tata Teleservices Ltd, based on the first-come-first served policy for 22 circles.