Cabinet decides to go for presidential reference on spectrum auction order

The Cabinet on Tuesday approved a proposal of the department of telecommunications (DoT) to seek a presidential reference on certain issues pertaining to the Supreme Court judgment in the 2G telecom spectrum case.

The issues include whether all telecom licences given on first-come-first-served (FCFS) basis before 2008 should be declared illegal and cancelled. The reference will also seek the court's view on a more fundamental issue: whether the judgement lays down auction as mandatory for allocation of all natural resources across all sectors and in all circumstances. A view on this could have an impact on mining leases, land allocation, allotment of coal blocks, oil blocks, etc.

The Supreme Court judgement of February 2 ordered the cancellation of 122 2G licences issued in January 2008, as the FCFS process was not transparent.

“Today, the Cabinet cleared all questions for which we are seeking a presidential reference under advisory jurisdiction,” communications and IT minister Kapil Sibal said after the meeting.

The reference will also seek directions from the court on whether the government should cancel permits given to dual technology players, apart from withdrawing 3G spectrum given to operators whose 2G licences had been cancelled earlier.

According to Article 143 of the Constitution, the President may refer a question of law or fact of “public importance” to the Supreme Court to get its opinion. The court may, after a hearing, report to the President its opinion on the issues referred to it. The court is not bound to give its opinion.

In the case of the Ayodhya land dispute, the court returned the questions involving matters of faith and history to the President without answering them. The opinion, if given, is not binding on the government.

A decision on the reference would be crucial, as it would impact the future of top incumbent telcos in the country, including Vodafone, Bharti Airtel, Aircel and dual technology players Reliance Communications and Tata Teleservices. It involves 51 more UAS licences issued between 2004 and 2007 on FCFS norms, besides 22 basic licences in 2001.

The government had gone for a review petition on the ground that the court had entered the realm of policy-making contrary to the principle of separation of powers. The petition is scheduled for hearing on Friday this week.