2G Case: Govt Asks SC to Review ‘First-Come-First-Serve’ Ruling

Says apex court has crossed the limits of judicial review and entered the realm of policy-making

The Union of India has asked the Supreme Court to review its ruling of February 2, 2012, that bars the state from allocating natural resources on first-come-firstserve basis, a policy followed to allot mobile permits in 2008. The department did not challenge the Supreme Court's decision, part of the same ruling, quashing 122 mobile permits given to eight telecom companies. 

In a review petition filed in the court on Friday, the government has sought a reconsideration of the judgment since there were "errors which are apparent on the face of the record." 
The government told the court that it had travelled beyond the limits of judicial review and entered the realm of policy-making. The government said that the court did not appreciate that methods other than public auction could be used to distribute natural resources and argues that its findings were "without reason." It added that the court "erred in striking down the policy of firstcome-first-serve as illegal per se," and also, "erred in holding that public auction is the only fair and transparent method by which a state can distribute natural resources." 
The review points out that the ruling contradicts a 1957 law governing allocation of mineral resources which mandates that entities that applied first for mining leases should get preference. The nub of the government's argument is that the court had substituted its own wisdom for that of the executive contradicting a plethora of court judgements that had asserted the contrary. 
In the judgement, which is under challenge, the court had trashed recommendations of TRAI which had that an unlimited number of licenses could be issued at the same price as in 2001. In the review petition the Centre says it was not up to the court to reject TRAI's recommendations just because it disagreed with them. 
A RAJA CHALLENGES VERDICT 
Besides the government, the former telecom minister A Raja has also challenged the verdict and has sought to become a party to the proceedings. Raja told the court that he was not given a chance to be heard even when the judgment condemns him for allegedly committing illegalities. According to the review petition seen by ET, Raja told the court that the "… judgment condemns the petitioner for various alleged actions, illegalities, deviations and purposeful acts to favour parties have been made without affording any right to give an explanation which could have been given by the petitioner had he been heard in the case." 
Raja said that findings of the verdict were 'bound to prejudice' his defence in the ongoing 2G spectrum allocation case, in the CBI Special Court, where he is the prime accused along with 17 others. 
Raja has been in prison for over a year. The CBI has charged the DMK MP of colluding with certain companies and giving them mobile permits at rock-bottom prices despite their ineligibility. 
FOUR COS MOVE COURT 
Besides the government and Raja, four telecom companies challenged the quashing of their mobile permits in the Supreme Court on Friday. Sistema Shyam Teleservices, or SSTL, a joint venture between Russian conglomerate Sistema and India's Shyam Group, filed a review petition arguing that it was "being unfairly penalised for acting in good faith and in reliance on the appropriateness of the procedures established by India's telecommunications authorities." Earlier this week, Sistema had threatened India with international arbitration proceedings if the government failed to amicably resolve by August 28 the problems caused by the fallout of the Supreme Court's verdict that cancelled 21 of Sistema Shyam's 22 licences in India. 
Uninor, the joint venture between Norway's Telenor and India's Unitech Group sought relief against the SC's order of cancellation of its licences. "Uninor has pointed out the severe adverse consequences for the licence holders and their stakeholders, such as massive subscriber base, foreign investors, lenders, suppliers and employees," the telco stated. 
The telco said that it had pointed out what it described as "errors" in the order, including the reference to transfer of equity shares from Unitech to Telenor Group, which was not the case. "Telenor Group has invested . 6,100 crore into Uninor. All approvals required for such investment by Telenor were duly obtained by Uninor, including approval from FIPB and CCEA. It has also and fully guaranteed approximately . 8,000 crore in short-term debt," the company said in a statement on Friday. 
Dubai-based Etisalat also filed a review petition but this was rejected due a technical error. An executive from the company said it will re-file the petition on Saturday. Etisalat is in the process of wrapping up operations in India following the order and has begun legal proceedings against the Indian promoters of joint venture with DB Group. 
Videocon Telecommunications, a subsidiary of Videocon Industries, also moved the SC against its judgment to cancel mobile permits. VTL's managing director RN Dhoot told ET that the court had not found any wrongdoing on the company's part yet cancelled its licences. "We've told the court (Supreme Court) that CBI has given us a clean chit, you yourself have not levied any penalty on us and said we were innocent. We have done nothing wrong," Dhoot said and added that the company planned to continue its services and participate in the 2G auctions. Telecom secretary R Chandrasekhar had told ET on Thursday that the there were a number of observations and findings of the court with regard to policy and policy-making, the role of the executive and judiciary in policy-making, which needed the court's attention.