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Informist, Friday, Feb. 20, 2026

 

NEW DELHI – The Supreme Court Friday held Sistema Shyam Teleservices Ltd. liable to pay the reserve price for spectrum in eight circles from Feb. 2, 2012, when the court had declared illegal the grant of unified access service licences and allotment of second generation band spectrum to various parties, till Apr. 30, 2013, when the company was given a letter of intent for another spectrum auction. In addition, the company will have to pay the reserve price from Feb. 2, 2012, to Mar. 23, 2013, for 13 circles. Mar. 23, 2013, was when the company stopped operations in these circles.

 

The company will have to pay interest on these sums at the State Bank of India's prime lending rate only from Dec. 8, 2014, the date of expiry of the 21 days stipulated in the show-cause notice by the Department of Telecommunications. The amount already paid by Sistema Shyam will be adjusted against the total amount due in terms of the court's order and the company will have to pay the balance amount within three months of the date of receipt of the demand raised by the department, the court said.

 

The court said its previous order of Feb. 15, 2013, which directed payment of the reserve price fixed by the government for the spectrum auction by companies that continued operations after Feb. 2, 2012, in view of extensions given, was binding on the parties and attained finality and has to be given full effect to. The question of diluting the order by extending the commencement date does not arise and there is no possibility of extending any benefit to the company in variance thereof, it said and set aside a part of the Telecom Disputes Settlement and Appellant Tribunal's ruling. This aspect is not open to interpretation and inquiry by the appellate tribunal and it cannot apply its own logic and decide that the commencement date would be Feb. 15, 2013, the top court said.

 

The court upheld the part of the appellate tribunal's order that held the closing date to be Apr. 30, 2013, for eight circles, observing that the question of the levy of this liability continuing beyond that date till the issuance of the licence in October 2013 does not arise. Further, the appellate tribunal was correct in asking the department to levy interest only from the expiry of the time stipulated in the show-cause notice in 2014. Having slept on the matter for that length of time, the department cannot now take advantage of its own lassitude and push upon the company the interest liability for that period, the court said.

 

In 2017, the department had issued a demand notice to the company, asking it to pay INR 9.27 billion, including INR 5.85 billion towards the reserve price from Feb. 2, 2012, to Oct. 2, 2013. INR 3.42 billion was interest for the period. Challenging the demand notice, Sistema Shyam moved the appellate tribunal, which specified the dates to be used for calculating the reserve price. Questioning the appellate tribunal's order, the telecom department moved the apex court, which cleared the air on the dates to be followed for the reserve price payment.  End

 

Reported by Surya Tripathi

Edited by Rajeev Pai

 

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