Supreme Court Questions Government on Plans to Hike Spectrum Charges

The Supreme Court on Tuesday asked the central government if it was seeking to hike the spectrum usage charge of one percent of the annual gross revenue of telecom companies for 4G services and if it had the powers to do so.

A bench of Chief Justice T.S. Thakur, Justice A.K. Sikri and Justice R. Banumathi also asked the central government to state if it, indeed, had the powers to hike the charges, then what was the source of that authority.

"What is the logic of an increase?" it queried.

The posers to the government came in the course of a hearing of a public interest plea by the Centre for Public Interest Litigation seeking the quashing of the decision permitting Reliance Jio to enter the voice telephony services using 4G spectrum.

Reserving the order after the daylong hearing, the apex court gave a week's time to the petitioner, the government and Reliance Jio to file their written notes, along with the citation of the previous judgments to back their contentions.

Counsel Prashant Bhushan, appearing for the petitioner, told the court that the official auditor had also flagged that a lower one percent spectrum charge can't be different from what was being charged from the holders of airwaves for 2G and 3G services.

"You (the government) will not be justified in levying a lower charge on the grounds that the cost of laying infrastructure is higher," the court observed. "Bhushan's worry is you are getting away cheaply."

Senior counsel Harish Salve, appearing for Reliance Jio, said the services were becoming cheaper. "Reliance Communications is offering a package, which includes a smartphone, for Rs. 7,000."

In an apparent jibe at former communications minister Kapil Sibal for his statement that there was "zero loss" to the exchequer for selling the spectrum cheap, the bench said: "Zero loss is also a mistake."

The apex court had on May 9 last year issued notice based on the plea that sought a probe into the decision by which Reliance Jio was allowed entry into the voice telephony space using 4G spectrum by paying the price that was determined way back in 2001.

The petition had sought a court-monitored probe and alleged the government decision was in violation of the apex court judgment in the presidential reference on the alienation of natural resource by the government to private operators.