Court stays telecom tribunal’s order on hiked 2G rates

NEW DELHI - The Supreme Court Friday stayed the Telecom Dispute Settlement and Appellate Tribunal’s (TDSAT) judgment upholding the Department of Telecommunication (DoT) order of May 2, 2010 hiking the rates of 2G spectrum.

A bench of Chief Justice S.H. Kapadia, Justice K.S. Radhakrishnan and Justice Swatanter Kumar also issued notice to DoT on a petition by the telecom giants Vodafone, Bharti Airtel and Idea Cellular challenging the May 2 order.

The TDSAT bench, headed by Justice S.B. Sinha, Sep 1 dismissed the petition by the major telecom operators challenging the hike and asked them to pay the increased charges along with 18 percent interest.

Staying the tribunal verdict, the court asked the telecom operators to deposit 50 percent of the principal amount with the apex court registry and for the remaining 50 percent by way of bank guarantee drawn on a nationalised bank.

The court said that the managing directors of the telecom companies will give an undertaking that in the event they lose in the apex court, they will be bound to pay the interest rate to be decided by the court.

Appearing for the the telecom operators, senior counsel Abhishek Manu Singhvi, C.S. Vaidyanathan and Mukul Rohtagi argued that 2G and 3G spectrum could not be taken on same footing.

It may be recalled that TDSAT whose order is under challenge did not accept the telecom operators’ contention that DoT did not follow the prescribed procedure in arriving at the decision of hiking the 2G charges.

However, DoT told the Tribunal that being the licensor, it had the requisite power to revise the annual spectrum charges for the cellular mobile telephone service (CMTS) and unified access service licensing (UASL).

DoT said that from the chronological events on revision of 2G spectrum annual usage charges vis–vis the 3G, it would be evident that it had acted within its jurisdiction in increasing the 2G charges.