Supreme Court of India
BHARAT SANCHAR NIGAM LIMITEDversusTELECOM REGULATORY AUTHORITY OF INDIA AND OTHERS
- Citation
- 2013 INSC 808
- Decided
- 6 December 2013
- Disposal
- Reference answered
- Bench
- G S SINGHVI
Holding
TDSAT does not have jurisdiction to entertain challenges to regulations framed by the Authority under Section 36 of the TRAI Act; such challenges must be brought before the High Court.
Summary
The Supreme Court examined whether the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) could entertain challenges to regulations made by the Telecom Regulatory Authority of India (TRAI) under Section 36 of the Telecom Regulatory Authority of India Act, 1997. It held that the power conferred on TRAI by Section 36(1) to make regulations is wide, legislative, and not limited by Section 36(2) or by Sections 11, 12 and 13 of the Act. Consequently, TDSAT, whose jurisdiction under Section 14(b) is limited to appeals against directions, decisions or orders, does not have authority to review the validity of TRAI's regulations, which are subordinate legislation. Such challenges must be filed in the High Court. The Court dismissed the appeal, affirming the narrow jurisdiction of TDSAT.
Issues considered
- Whether TDSAT has jurisdiction under Section 14(b) of the TRAI Act to entertain challenges to regulations framed by TRAI under Section 36.
- Whether the power under Section 36(1) of the TRAI Act is limited by Section 36(2) or by Sections 11, 12 and 13 of the Act.
- Whether regulations made under Section 36 constitute subordinate legislation subject to judicial review by courts rather than by TDSAT.
Legislation cited
- Administrative Tribunals Act, 1985s. 14
- Consumer Protection Act, 1986s. 9
- Electricity Act, 2003s. 111, s. 121, s. 178, s. 181, s. 182, s. 73, s. 75, s. 79
- Indian Telegraph Act, 1885s. 4, s. 78
- Monopolies and Restrictive Trade Practices Act, 1969s. 5
- Telecom Regulatory Authority of India Act, 1997s. 11, s. 12, s. 13, s. 14(a), s. 14A, s. 14(b), s. 33, s. 35, s. 36, s. 37
- Telecom Regulatory Authority of India (Amendment) Act, 2000
Subjects
telecom regulationdelegated legislationsubordinate legislationjurisdictionTDSATTRAISection 36Section 14(b)judicial reviewinterconnectivityregulationsappellate tribunal
Judgment
\
[2013] 12 S.C.R. 999
BHARAT SANCHAR NIGAM LIMITED A
v.
TELECOMREGULATORY AUTHORITY OF INDIA AND
OTHERS
(Civil Appeal No. 5253 of 2010)
DECEMBER 6, 2013 B
[G.S. SINGHVI, DR. B.S. CHAUHAN AND FAKKIR
MOHAMED IBRAHIM KALIFULLA, JJ.]
Telecom Regulatory Authority of India Act, 1997: C
s.36 - Power of Telecom Regulatory Authority of India
(Authority) to frame regulations - Held: Under sub-s. (1) of
s.36, the Authority can make regulations to carry out the
purposes of the Act specified in various provisions of the Act D
including ss. 11, 12 and 13 - The Authority can make
regulations which may empower it to issue directions of
general character applicable to seNice providers and others
and it cannot be said that by making regulations u/s 36(1) ,
the Authority has encroached upon the field occupied by E
s.12(4) and 13 - Power vested in the Authority u/s 36(1) to
make regulations is wide and peNasive - Exercise of this
power is only subject to the provisions of the Act and the Rules
framed u/s 35 thereof- It is not controlled or limited by s.36(2)
or ss.11, 12 and 13 - There is nothing in the language of
s.36(2) from which it can be inferred that provisions contained F
therein control the exercise of power by Authority u/s 36(1) or
that s.36(2) restricts the scope of s.36(1) - It is settled law
that if power is conferred upon an authority/body to make
subordinate legislation in general terms, the particularization
of topics is merely illustrative and does not limit the scope of G
general power - Interpretation of Statutes - Delegated
legislation - Doctrine of occupied field.
ss. 33, 36 and 37 - Power of Authority to frame
999 H
1000 SUPREME COURT REPORTS [2013) 12 S.C.R.
A regulations - Held: The power u/s 36 is legislative -This power
is non-delegable - By virtue of s.37, regulations made under
the Act are placed on par with the rules which can be framed
by Central Government uls 35 and being 7n the nature of
subordinate legislation, rules and regulations have to be laid
B before both the Houses of Parliament which can annul or
modify the same - Thus, regulations framed by Authority can
be made ineffective or modified by Parliament and by no
other body - Delegated legislation.
s.14(b)(as amended by Amendment Act, 2000) - Judicial
C review of regulations framed by Authority - Held: In exercise
of the power vested in TDSAT uls 14(b), it does not have the
jurisdiction to entertain the challenge to the regulations
framed by the Authority uls 36 - The amendment is intended
to vest original jurisdiction of the Authority in TDSA T and the
D same is achieved bys. 14(a) - The appellate jurisdiction
exercisable by High Court is also vested in TDSA T by virtue
of s.14(b) - Since High Court while hearing appeal did not
have the power of judicial review of subordinate legislation,
the transferee adjudicatory forum, i.e., TDSAT cannot
E exercise that power u/s 14(b)- Telecom Regulatory Authority
of India (Amendment) Act, 2000.
In the instant appeals, a two Judge Bench made a
reference to the larger Bench for determination of certain
F substantial questions of law of public importance. When
the matters were listed before the three-Judge Bench,
counsel for the parties agreed that a preliminary issue
relating to jurisdiction of the Telecom Disputes Settlement
Appellate Tribunal (TDSAT) to entertain challenge to the .
regulations framed by the Telecom Regulatory Authority
G of India (Authority) may be decided first. Therefore, the
question for consideration before the Court was: Whetlier
in exercise of the power vested in it uls 14(b) of the Act,
TDSAT has the jurisdiction to entertain challenge to the
regulations framed by the Authority uls 36 of the Act.
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1001
REGULATORY AUTH. OF INDIA
Answering the reference, the Court A
HELD:1.1. Under the Telecom Regulatory Authority
of India Act, 1997 (un-amended Act), the Telecom
Regulatory Authority of India had three types of functions,
namely, recommendatory functions, regulatory functions B
and adjudicatory functions. With a view to overcome the
difficulties experienced in the implementation of the Act,
certain amendments were brought by the Telecom
Regulatory Authority of India (Amendments) Act, 2000.
One of the important features of the Amendment Act was
the establishment of a Tribunal known as the Telecom C
Disputes Settlement and Appellate Tribunal (TDSAT). [Para
20 and 26] [1044-G; 1045-A-B; 1079-E; 1080-E; 1081-C]
1.2. After the amendment of 2000, the Authority can
either suo motu or on a request from the licensor make D
recommendations on the subjects enumerated in
. s.11(1)(a)(i) to (viii). Under s.11 (1)(b), the authority is
required to perform nine functions enumerated in clauses
(i) to (ix) thereof. In these clauses, different terms like
'ensure', 'fix', 'regulate' and 'lay down' have been used. E
The use of the term 'ensure' implies that the Authority can
issue directions on the particular subject. For effective
discharge of functions under various clauses of s. 11(1)
(b), the authority can frame appropriate regulations. The
term 'regulate' contained in sub-clause (iv) shows that for F
facilitating arrangement amongst service providers for
sharing their revenue derived from providing
telecommunication services, the Authority can either
issue directions or make regulations. [para 27]
~~1~~ G
1.3. The term 'regulate' is elastic enough to include
the power to issue directions or to make regulations and
the mere fact that the expression "as may be provided
in the regulations" appearing in clauses (vii) and (viii) of
s.11 (1 )(b) has not been used in other clauses of that sub- H
1002 SUPREME COURT REPORTS [2013] 12 S.C.R.
A section does not mean .that the regulations cannot be
framed uls 36(1) on the subjects specified in clauses (i)
to (vi) of s. 11 (1 )(b). In fact, by framing regulations uls 36,
the Authority can facilitate the exercise of functions under
various clauses of s.11 (1 )(b) including clauses (i) to (vi).
B [para 35] [1087-G-H; 1088-A-B]
V.S. Rice & Oil Mills v. State of A.P. 1964 SCR 456 =
AIR 1964 SC 1781; State of Tamil Nadu v. Hind Stone 1981
=
(2) SCR 742 (1981) 2 SCC 205; K. Ramanathan v. State
of Tamil Nadu 1985 (2) SCR 1028 = (198.5) 2 sec 116;
C Jiyajeerao Cotton Mills Ltd. v. M.P. Electricity Board 1988 (2)
=
Suppl. SCR 978 1989 Supp (2) SCC 52; Deepak Theatre
=
v. State of Punjab 1991 (3) Suppl. SCR 242 1992 Supp
(1) SCC 684; Quarry Owners' Association v. State of Bihar
=
2000 (2) Suppl. SCR 211 (2000) 8 sec 655; U.P. Coop.
D Cane Unions Federation v. West U.P. Sugar Mills
=
Association 2004 (2) Suppl. SCR 238 (2004) 5 SCC 430-
referred to.
Webster's Third New International Dictionary, Vol. II, p.
E 1913 and Shorter Oxford Dictionary, Vol. II, 3rd Edn., p. 1784
- referred to.
1.4. Under sub-s. (1) of s.36, the Authority can make
regulations to carry out the purposes of the Act specified
in various provisions of the Act including ss.11, 12 and
F 13. The exercise of power uls 36(1) is hedged with the
condition that the regulations must be consistent with the
Act and the Rules made thereunder. There is no other
restriction on the power of the Authority to make
regulations. In terms of s.37, the regulations are required
G to be laid before Parliament which can either approve,
modify or annul the same. Section 36(2), which begins
with the words "without prejudice to the generality of the
power under sub-s. (1)" specifies various topics on which
regulations can be made by the Authority. Three of these
H topics relate to meetings of the Authority, the procedure
BHARAT SANCHAR NIGAM LTD v. TELECOM 1003
REGULATORY AUTH. OF INDIA
to be followed at such meetings, the transaction of A
business at the meetings and the register to be
maintained by the Authority. The remaining two topics
specified in Clauses (e) and (f) of s. 36(2) are directly
referable to s.11 (1 )(b)(viii) and 11 (1 )(c). These are
substantive functions of the Authority. However, there is B
nothing in the language of s.36(2) from which it can be
inferred that the provisions contained therein control the
exercise of power by the Authority u/s 36(1) or that s.36(2)
restricts the scope of s.36(1 ). [para 36] [1088-B-F]
1.5. It is settled law that if power is conferred upon C
an authority/body to make subordinate legislation in
general terms, the particularization of topics is merely
illustrative and does not limit the scope of general power.
[para 37] [1088-G]
D
Afzal Ullah v. State of Uttar Pradesh 1964 (4) SCR 991;
Rohtak Hissar District Electricity Supply Company Ltd. v.
State of Uttar Pradesh and others 1966 SCR 863 =AIR 1966
SC 1471; Santosh Kumar Jain v. State 1951 SCR 303 =AIR
1951 SC 201; D.K. Trivedi and Sons v. State of Gujarat 1986 E
SCR 479 1986 (Supp) SCC 20; Academy of Nutrition
Improvement v. Union of India 2011 (8) SCR 680 = (2011) 8
sec 274 - relied on.
Emperor v. Sibnath Banerji AIR 1942 PC 156 - referred
to. F
1.6. Section 11 (1 )(b)(iv) specifically postulates making
of regulations for discharging the functions specified in
those clauses. Section 11 (2), which contains non-
obstante clause vis-a-vis the Indian Telegraph Act, 1885, G
lays down that the Authority may, from time to time, by
order notify the rates at which the telecommunication
services within or outside India shall be provided under
the Act subject to the limitation specified in s.11 (3). Under
s.12(1), the Authority is empowered to issue order and H
1004 SUPREME COURT REPORTS (2013] 12 S.C.R.
A call upon any service provider to furnish such information
or explanation relating to its affair or appoint one or more
persons to make an inquiry in relation to the affairs of any
service provider and direct inspection of the books of
account or other documents of any service provider.
B Sections 12(4) and 13 of the Act are only enabling
provisions. This is evinced from the expressions "shall
have the power" used in s.12(4) and "The Authority may"
used in s.13. [para 43] [1096-C-G]
1.7. In terms of s.12(4), the Authority can issue such
C directions to service providers, as it may consider
necessary, for proper functioning by service providers.
Section 13 lays down that the Authority may for
discharge of its functions u/s 11(1), issue such directions
to the service providers, as it may consider necessary.
D The scope of this provision is limited by the proviso,
which lays down that no direction u/s 12(4) or s.13 shall
be issued except on matters specified in s.11(1)(b). [para
43] [1096-G-H; 1097·A]
E 1.8. It is, thus, clear that the Authority, in discharge
of its functions, can issue directions to the service
providers.The Act speaks of many players like the
licensors and users, who do not come within the ambit
of the term "service provider". If the Authority has to
F discharge its functions qua the licensors or users, then
it will have to use powers under provisions other than
ss.12(4) and 13. [para 43] [1097-A-B]
1.9. Therefore, in exercise of power u/s 36(1), the
Authority can make regulations which may empower it to
G issue directions of general character applicable to
service providers and others and it cannot be said that
by making regulations u/s 36(1) the Authority has
encroached upon the field occupied by s:12(4) and 13 of
the Act. [para 43] [1097-C-D]
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1005
REGULATORY AUTH. OF INDIA
1.10. A plain reading of the language of s.33 makes A -
it clear that the Authority can, by general or special order,
delegate to any member or officer of the Authority or any
other person such of its powers and functions under the
Act except the power to settle disputes under Chapter IV
or make regulations u/s 36. This means that the power B
to make regulations u/s 36 is non-delegable. The reason
for excluding s. 36 from the purview of s.33 is that the
power u/s 36 is legislative as opposed to administrative.
By virtue of s.37, the regulations made under the Act are
placed on par with the rules which can be framed by the c
Central Government u/s 35 and being in the nature of
subordinate legislations, the rules and regulations have
to be laid before both the Houses of Parliament which
can annul or modify the same. Thus, the regulations
framed by the Authority can be made ineffective or 0
modified by Parliament and by no other body. [para 44)
[1097-D-G]
1.11. This Court, therefore, holds that the power
vested in the Authority u/s 36(1) to make regulations is wide
· and pervasive. The exercise of this power is only subject E
to the provisions of the Act and the Rules framed u/s 35
thereof. There is no other limitation on the exercise of
power by the Authority u/s 36(1). It is not controlled or
limited by s.36(2) or ss.11, 12 and 13. [para 45) [1098-A-B]
2.1. Under the un-amended s.14(1 ), the Authority F
could decide disputes among service providers and
between service providers and a group of consumers. In
terms of s.14(2) (unamended), the bench constituted by
the Chairperson of the Authority could exercise powers
and authority which were exercisable earlier by the civil G
court on technical compatibility and inter-connections
between service providers, revenue sharing
arrangements between different service providers, quality
of telecommunication services and interest of
consumers. However, the disputes specified in clauses H
1006 SUPREME COURT REPORTS [2013] 12 S.C.R.
A (a), (b) and (c) of s.14(2) could not be d1icided by the
bench constituted by the Chairperson. [para 49] [1100-F-
H; 1101-A]
2.2. Since the mechanism provided for settlement of
disputes u/s 14 of the unamended Act was not
8 satisfactory, Parliament substituted that section and
facilitated establishment of an independent adjudicatory
body known as TDSAT. Clause (a) of amended s.14
confers jurisdiction upon TDSAT to adjudicate any
dispute between a licensor and licensee, between two or
C more service providers and between a service provider
and a group of consumers. Three exceptions to the
adjudicatory power of TDSAT relate to the cases: which
are subject to the jurisdiction of Monopolies and
Restrictive Trade Practices Commission, the complaint of
D an individual consumer which could be maintained under
the consumer forums established under the Consumer
Protection Act, 1986 and dispute between Telegraph
Authority and any other person referred t'o in s.78(1) of
the Indian Telegraph Act, 1885. In terms of clause (b) of
E s. 14 (amended), TDSAT is empowered to hear and
dispose of appeal against any direction, decision or
order of the Authority. Section 14A(1) provides for making
of an application to TDSAT for adjudication of any
dispute referred to in s.14(a). Section 14A(2) and (3)
F provides for filing an appeal against any direction,
decision or order made by the Authority and also
prescribes the period of limitation. [para 50] [1101-B-F]
2.3. The primary objective of the 2000 amendment
was to separate adjudicatory functions of the Authority
G from its administrative and legislative functions and ward
off the criticism that the one who is empowered to make
regulations and issue directions or pass orders is
clothed with the power to decide legality thereof. The
word 'dinection' used in s.14(b) is referable to ss.12(4) and
H 13. The word 'order' is referable to ss.11(2) and 12(1). The
BHARAT SANCHAR NIGAM LTD v. TELECOM 1007
REGULATORY AUTH. OF INDIA
word 'decision' has been used in s.14-A(2) and (7). This A
is because the proviso to s.14-M postulates limited
adjudicatory function of the Authority in respect of the
disputes being adjudicated under Chapter IV before the
2000 amendment. This proviso was incorporated in s.14-
M to avoid a hiatus between the coming into force of the B
2000 amendment and the establishment of TDSAT. [para
51] [1102-C-E]
2.4. None of the words used in s.14(b) have anything
to do with adjudication of disputes. Before the 2000 C
Amendment, the applications were required to be filed u/
s 15 which also contained detailed procedure for deciding
tl•e same. While sub-s. (2) of s.15 used the word 'orders',
sub-ss. (3) and (4) thereof used the word 'decision'. In
terms of sub-s. (5), the orders and directions of the
Authority were treated as binding on the service D
providers, Government and all other persons concerned.
Section 18 provided for an appeal against any decision
or order of the Authority. Such an appeal could be filed
before the High Court. [para 52] [1102-F-H]
E
2.5. The amendment made in 2000 is intended to vest
the original jurisdiction of the Authority in TDSAT and the
same is achieved by s. 14(a). The appellate jurisdiction
exercisable by the High Court is also vested in TDSAT
by virtue of s.14(b). Section 14-N provides for transfer to F
all appeals pending before the High Court to TDSAT and
in terms of Clause (b) of sub-s. (2), TDSAT was required
to proceed to deal with the appeal from the stage which
was reached before such transfer or from any earlier
stage or de novo as considered appropriate by it. [para G
52] [1102-H; 1103-A-B]
2.6. Since the High Court while hearing appeal did
not have the power of judicial review of subordinate
legislation, the transferee adjudicatory forum, i.e., TDSAT
cannot exercise that power u/s 14(b). [para 52] [1103-C] H
1008 SUPREME COURT REPORTS [2013] 12 S.C.R.
A Cellular Operators Association of India v. Union of India
=
2002 (5) Suppl. SCR 222 (2003) 3 SCC 186; Union of India
v. TATA Teleservices (Maharashtra) Ltd. 2007 (9) SCR 285
=(2007) 7 sec 517;. - held inapplicable.
L. Chandra Kumar v. Union of India 1997 (2)
8
=
SCR 1186 (1997) 3 SCC 261· distinguished
2.7. In PTC India Ltd**., the Constitution Bench has
held that a regulation uls 178 of the Electricity Act, 2003
is made under the authority of delegated legislation and
C consequently its validity can be tested only in judicial
review proceedings before the courts and not by way of
appeal before the Appellate Tribunal. [para 58 and 60]
[1108-F-G; 1114-C-D]
0 **PTC India Ltd. v. Central Electricity Regulatory
Commission, (2010) 4 SCC 603 - followed.
Narinder Chand Hem Raj v. Lt. Governor, H.P. (1971) 2
SCC 747 and Indian Express Newspapers (Bombay) (P) Ltd.
=
v. Union of India 1985 (2) SCR 287 (1985) 1 SCC 641 •
E referred to
Union of India v. Madras Bar Association 2010 (6)
=
SCR 857 (2010) 11 SCC 1; State of Gujarat v. Gujarat
Revenue Tribunal Bar Association 2012 (10) SCR 816 =
F (2012) 10 sec 353: 2012 (10) SCALE 285 - held
inapplicable.
2.8. In BPL Mobile Cellular Ltd*., the word 'directions'
used in s.29 of the Act was interpreted to include orders
and regulations in the context of the factual matrix of that
G case but the same cannot be read as laying down a
proposition of law that the words 'direction', 'decision' or
'order' used in s.14(b) would include regulation framed
under s.36, which are in the nature of subordinate
legislation. [para 57] [1108-E-F]
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1009
REGULATORY AUTH. OF INDIA
*Telecom Regulatory Authority of India v. BPL Mobile A
Cellular Ltd. CA No. 6743 - distinguished.
2.9. This Court, therefore, holds that in exercise of the
power vested in it uls 14(b) of the Act, TDSAT does not
have the jurisdiction to entertain the challenge to the B
regulations framed by the Authority uls 36 of the Act.
[para 64] [1118-H; 1119-A]
2.10. It is made clear that the aggrieved person shall
be free to challenge the validity of the regulations framed
uls 36 of the Act by filing appropriate petition before the C
High Court. [para 65] [1119-B]
Hotel & Restaurant Association v. Star India (P) Ltd. 2006
=
(9) Suppl. SCR 602 (2006) 13 SCC 753, Union of India v.
Association of Unified Telecom Service Providers of D
India 2011 (14) SCR 657 = (2011) 1o sec 543; Delhi
Science Forum vs. Union of India (1996) 2 SCC 405; MTNL
v. TRAI AIR 2000 (Delhi) 208; Clariant International Limited
v. Security Exchange Board 2004 (3) Suppl. SCR 843 =
(2004) 8 SCC 524, and West Bengal Electivity Regulatory E
Com'J'ission V; CESC Ltd (2002) 8 SCC 715 - cited.
Case Law Reference:
AIR 2000 (Delhi) 208 cited para 13.3
2004 (3) Suppl. SCR 843 cited para 13.3 F
2002 (5) Suppl. SCR 222 held inapplicablePara 13.3
(2002) 8 sec 115 cited para 13.3
(1996) 2 sec 405 cited para 17 G
1964 SCR 456 referred to para 28
1981 (2) SCR 742 referred to para 29
1985 (2) SCR 1028 referred to para 30
H
1010 SUPREME COURT REPORTS [2013] 12 S.C.R.
A 1988 (2) Suppl. SCR 978 referred to para 31
1991 (3) Suppl. SCR 242 referred to para 32
2000 (2) Suppl. SCR 211 referred to para 33
2004 (2) Suppl. SCR 238 referred to para 34
B
AIR 1942 PC 156 referred to para 37
1964 (4) SCR 991 relied on para 38
1966 SCR 863 relied on para 39
c
1951 SCR 303 relied on para 40
1986 SCR479 relied on para 41
2011 (8) SCR 680 relied on para 42
D 1997 (2) SCR 1186 distinguished Para 47
(201 O) 4 sec 603 followed para 47
2006 (9) Suppl. SCR 602 cited para 48
E 2011 (14) SCR 657 cited para 48
2010 (6) SCR 857 held inapplicable para 48
2007 (9) SCR 285 held inapplic:able Para 54
CA No. 6743 distinguished para 56
F
(1971) 2 sec 141 referred to para 59
1985 (2) SCR 287 referred to para 59
2012 (10) SCR 816 held inapplicable para 63
G
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
5253 of 2010.
From the Judgment & Order dated 28.05.2010 of the
Telecom Disputes Settlement and Appellate Tribunal (TDSAT)
H at New Delhi in Appeal No. 4 of 2007.
BHARAT SANCHAR NIGAM LTD v. TELECOM 1011
REGULATORY AUTH. OF INDIA
WITH A
Civil Appeal Nos. 951-952, 3298, 3299, 4529, 5834-5836,
5837 and 6049 of 2005, 802, 2731, 2794 and 3504 of 2006,
4965-4966 of 2007, 177 and 598-599 of 2008, 5184, 5873,
6068, 6255, D28298 and T.C. No. 39 of 2010, Civil Appeal B
No. 271-281 of 2011.
R.F. Nariman, SG, Rakesh Khanna, ASG, Ramji
Srinivasan, Rakesh Dwivedi, Dr. A.M. Singhvi, Mukul Rohatgi,
Maneesha Dhir, Ritesh Kumar, Siddharth Patnaik, Amit Singh,
Siddarth Tyagi, Debopama Roy, K.P.S. Kohli, Manjul Bajpai, C
Shashwat Bajpai, Bina Gupta, Abhay A. Jena, Nakul Mehta,
Kawaljit Singh Bhatia, Vivek Paul Orien, E.G. Agrawala, Madhu
Sikri, Manali Singhal, Santosh Sachin, Abhijat P. Medh, Monika
Singhal, Prakhar Nishant, Mohit Auluck, Rajiv Mehta, Priyanka
Das, Manu Aggarwal, Sanjay Kapur, Anmol Chandan, Ashmi D
Mohan, Abhinav Mukerji, Gopal Jain, Navin Chawla, Abhishek
Kr. Jha, Devan Khanna, Ravi Sikri, Ayushya Kumar, Gargi
Khanna, Aditi Tripathi, Rachana Joshi lssar, Amreen Rasool for
the appearing parties.
E
The Judgment of the Court was delivered by
G.S. SINGHVI, J. 1. By an order dated 6.2.2007 passed
in Civil Appeal No. 3298 of 2005 - Telecom Regulatory
Authority of India (Authority) v. Bharat Sanchar Nigam Limited
(BSNL) and connected matters, a two Judge Bench made a F
reference to the larger Bench for determination of the following
substantial questions of law of public importance:
1. Whether in the event of any inconsistency between
the terms and conditions of the licenses issued G
under Section 4 of the Indian Telegraph Act, 1885
and the provisions of the Telecom Regulatory
Authority of India Act, 1997 (for short, 'the Act'), the
provisions of the Act would prevail in view of the
purpose and object for which the Act has been H
1012 SUPREME COURT REPORTS (2013] 12 S.C.R.
A passed, i.e., for ensuring rapid development of
telecommunications in the country incorporating the
most modern technology and, at the same time,
protecting the interests of the consumers and the
service providers?
B
2. Whether Authority has powers to fix the terms and
conditions of inter connectivity between service
providers, in respect of all the licenses, irrespective
of the fact whether licenses issued before or after
24.1.2000 - especially in view of the non-obstante
c clause in sub-section (1) of Section 11 and sub-
clause (ii) of Clause (b) of sub-section (I) of Section
11 of the TRAI (Amendment) Act of 2000?
3. Whether Authority has no power to fix terms and
D conditions of interconnectivity between service
providers in respect of licenses issued after
24.01.2000 including terms and conditions of
interconnection agreements - in view of, inter-alia,
the scheme laid down in the provisos to Section
E 11 (1) of the TRAI Act, 1997 as amended on
24.01.2000 and if it does not have any such power
what would be the harmonious construction at the
amended clause 11 (1)(b)(ii) and the new scheme
more specifically embodied in the provisos?
F 4. Whether under the amended provisions of the TRAI
Act, 1997 introduced w.e.f 24.01.2000 - the
harmonious construction of Section 11 (1 )(b)(ii) and
the scheme of the provisos to Section 11 (1) would
allow the Authority to have the power to fix the terms
G and conditions of interconnectivity with respect to
licenses issued before 24.1.2000. only to the extent
the licensor (Govt. of India) accepts the
recommendations of the Authority for incorporation
in the new licenses, so as to achieve level playing
H field between the service providers granted
BHARAT SANCHAR NIGAM LTD v. TELECOM 1013
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
licenses before and after the amendment of the A
TRAI Act?
5. Whether the appeals are maintainable in the
present form?
2. The larger Bench heard the arguments on various dates B
but released the cases vide order dated 19.10.2011.
Thereafter, by mistake the Registry listed all the rnatters before
a two Judge Bench. During the course of hearing, Shri A.S.
Chandhiok, learned senior advocate appearing for BSNL
invited the Court's attention to orders dated 6.2.2007 and C
21.10.2010 and pointed out that the cases were earlier heard
by the larger Bench. Thereupon, the two Judge Bench directed
that the cases be posted before the larger Bench.
3. When the cases were listed before this Bench, learned D
counsel for the parties agreed that a preliminary issue relating
to jurisdiction of the Telecom Disputes Settlement Appellate
Tribunal (TDSAT) to entertain challenge to the regulations
framed by the Authority may be decided before the questions
framed vide order dated 6.2.2007 are taken up for E
consideration. Thereupon, the Court decided to hear the
arguments on the following question:
"Whether in exercise of the power vested in it under
Section 14(b) of the Act, TDSAT has the jurisdiction to
entertain challenge to the regulations framed by the F
Authority under Section 36 of the Act.
4. For better appreciation of the arguments advanced by
learned counsel for the parties, we may notice the facts borne
out from the records of different appeals. G
Civil Appeal Nos. 5253. 5184. 5873, 6068, 6255 of 2010 and
Civil Appeal No. 028298 of 2010
5.1. The delay in filing and re-filing C.A. No. D28298 of
2010 is condoned. H
1014 SUPREME COURT REPORTS [2013] 12 S.C.R.
A 5.2. These appeals have been filed by Bharat Sanchar
Nigam Limited (BSNL), Cellular Operators Association of India
(COAi), Association of Unified Telecom Service Providers of
India (AUSPI), the Authority, M/s. Sistema Shyam TeleServices
Limited and Mahanagar Telephone Nigam Limited (MTNL),
B respectively, against order dated 28.5.2010 passed by TDSAT
whereby the appeal preferred by BSNL against the
Telecommunication Interconnection (Port ChargElS) Amendment
Regulation (1 of 2007) was allowed and the Authority was
directed to give fresh look at the regulations and BSNL was
c directed not to claim any amount from any operator during the
interregnum, i.e., from the date of coming into force of the
regulations and the date of the order.
5.3. A perusal of the record shows that port charges came
to be prescribed in Schedule 3 of the Telecommunication
D Interconnection (Charges and Revenue Sharing) Regulations,
1999, which came into force on 28.5.1999. By virtue of Clause
8, the regulations were given overriding effect qua the
interconnection agreements. MTNL challenged the 1999
regulations before the Delhi High Court in Civil Writ Petition No.
E 6543/1999, which was allowed by the Division Bench of the
High Court vide order dated 17.1.2000 [MTNL v. TRAI, AIR
2000 (Delhi) 208] and it was held that the Regulations framed
under Section 36 of the Act could not be given overriding effect.
Thereafter, the Authority framed the Telecommunication
F Interconnection (Port Charges) Amendment Regulations (6/
2001). The port charges were specified in the schedule to the ,
amended regulations. The amended regulations were
challenged in Appeal Nos.11/2002 and 31/2003, which were
allowed by TDSAT vide orders dated 27.4.2005 and 3.5.2005
G respectively.
5.4. In view of the aforesaid orders ofTDSAT, the Authority
sought response of various service providers for review of port
charges. In that process, BSNL raised objection to the
H jurisdiction of the Authority to vary the terms and conditions of
BHARAT SANCHAR NIGAM LTD v. TELECOM 1015
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J..J
interconnection agreements or the contractual rates. On A
2.2.2007, the Authority issued Telecommunication
Interconnection (Port Charges) Amendment Regulation (1 of
2007) reducing the port charges required to be paid by private
telecom operators to BSNL by about 23-29%. BSNL
challenged Notification dated 2.2.2007 in Appeal No. 4/2007. B
By an order dated 28.5.2010, TDSAT allowed the appeal of
BSNL and issued directions to which reference has been made
herein above.
Civil Appeal Nos. 951-952/2005
c
6.1. Civil Appeal No. 951/2005 has been filed by the
Authority against order dated 21.4.2004 by which TDSAT
allowed Appeal No.2/2004 filed by BSNL questioning direction
dated 31.12 .2003 issued under Section 13 read with Section
11(1)(b) of the Act. Civil Appeal No. 952/2005 has been filed D
by the Authority against order dated 10.8.2004 by which
TDSAT dismissed Petition No.2/2004 for review of order dated
21.4.2004.
6.2. On receiving information that some operators were E
disconnecting Points of Interconnection (Pol) for the reason of
1
non payment of Interconnection Usage Charges and other such
reasons, the Authority issued direction dated 31.12.2003 under
Section 13 read with Section 11(1)(b) conveying to all service
providers that disconnection of Pols was not desirable because
the subscribers would be inconvenienced and all disputes F
should be resolved through mutual negotiations. It was also
provided that if the dispute could not be resolved, then 10 days'
notice of disconnection should be given to the erring party with
a copy to the Authority. In the event of non-intervention by the
Authority, the aggrieved party could disconnect the Pol or G
approach the Authority for determination of the matter.
6.3. BSNL filed Appeal No.2/2004 for striking down the
. aforesaid direction on the ground that only TDSAT was vested
with the jurisdiction to decide the disputes and the Authority had H.
1016 SUPREME COURT REPORTS [2013] 12 S.C.R.
A no jurisdiction in the matter. TDSAT allowed the appeal and
held that the Authority did not have the jurisdiction to entertain
dispute between the service providers. TDSA"'" noted that the
words "dispute" and "determination" have been used in the
direction iSStled by the Authority, referred to the judgment of this
B Court in Cellular Operators Association of India v. Union of India
(2003) 3 SCC 186 and held that the jurisdiction of TDSAT is
quite wide and is circumscribed only by the three instances, i.e.,
disputes before the MRTP Commission, Consumer Forums
and those under Section 78 of the Telegraph Act.
c 6.4. The Authority filed Review Petition No. 2/2004 and
argued that while the Authority can be faulted for the use of
words "dispute" and "determination", its power to intervene
cannot be questioned. Another plea taken by the Authority was
that the regulations framed under Section 36 are in the nature
D of subordinate legislation and validity thereof cannot be
questioned before TDSAT. The review petition was dismissed
by TDSAT vide order dated 10.8.2004 reiterating that it had
jurisdiction to entertain dispute relating to validity of regulations.
E Civil Appeal Nos. 3298 and 4529 of 2005
7.1. These appeals are directed against order dated
27.4.2005 passed by TDSAT in Appeal Nos. 11 and 12 of 2002
filed by BSNL and MTNL respectively, challenging Clause 3.1
of the Telecommunication Interconnection (Reference
F Interconnect Offer) Regulation, 2002 (2 of 2002).
7.2. In exercise of its powers under Section 36 read with
Section 11(1)(c) and (d) of the unamended Act, the Authority
prescribed revenue sharing for service providers under the
G Calling Party Pays regime on 17.9.1999. This was challenged
before the Delhi High Court. In its judgement [MTNL v. TRAI
(supra)], the High Court observed that the Authority has no
power to change or vary rights of parties under contracts or
licenses.
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1017
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
7.3. After the judgment of the High Court, the Act was A
amended by Ordinance dated 24.1.2000 and Section
11 (1 )(b)(ii) was inserted to enable the Authority to fix the terms
and conditions of intercon.nectivity between the service
providers.
B
7.4. In exercise of the power vested in it under Section 36
read with Section 11 (1 )(b)(ii), (iii) and (iv), the Authority framed
the 2002 Regulations. Under Clause 3.1 of these regulations,
the service providers with significant market share were
required to publish their Reference Interconnect Offer (RIO) C
within 90 days of the issue of the Regulations with prior
approval of the Authority. The 2002 Regulations stipulate the
broad framework, structure and provisions on which the service
provider is to make an offer of interconnection with other service
providers. BSNL submitted the proposed RIO on 12.7.2002.
MTNL also submitted proposed RIO sometime in 2002. The D
RIOs of BSNL and MTNL were approved with certain changes
effected vide identically worded letters dated 9.10.2002.
7.5. BSNL and MTNL filed Appeal Nos. 11 and 12/2002
challenging letters dated 9.10.2002 issued by the Authority. It E
was contended inter a/ia that the Authority did not have the
power to frame such a regulation. They argued that the changes
suggested in the RIO were non transparent and under the garb
of the regulations, the Authority cannot be conferred power to
fix the terms and conditions of interconnectivity which BSNL and F
MTNL can offer to other service providers. Clause 3.1 was
challenged insofar as it had been interpreted to take away the
statutory right to appeal as granted under the Act.
7.6. TDSAT disposed of both the appeals vide order
dated 27.4.2005. TDSAT extensively referred to the orders G
passed in Review Petition No.2/2004 in Appeal No.2/2004
(BSNL v. TRAI) and Appeal No.3/2005 as also the order passed
by the Delhi High Court wherein it was held that TDSAT is
empowered to hear appeals involving challenge to the validity
of the regulations framed under Section 36. TDSAT then held H
1018 SUPREME COURT REPORTS (2013] 12 S.C.R.
A that even after amendment of the Act, the Authority does not
have the power to amend or override the terms and conditions
of the interconnect agreements executed by the service
providers.
Civil Appeal Nos. 3299, 6049 of 2005 and 802 of 2006
8
8.1. These appeals have been filed against order dated
3.5.2005 ofTDSATwhereby it allowed Appeal No.31/2003 and
partly allowed Petition No.20/2004 and quashed direction dated
22.7.2003 issued by the Authority on the premise that it did not
C have the power to override and make direct interconnectivity
mandatory.
8.2. Direct connectivity between different service providers
was introduced in light of NTP 1999 and the same was provided
D for in the license agreements of existing licensees through an
amendment on 29.1.2001 as per DoT letter dated 9.8."2000
which stated that direct connectivity was permitted for the
purpose of terminating traffic on the basis of mutual
agreements. In the meanwhile, on 29.9.2000 BSNL was
E granted license to provide cellular mobile services and it
commenced its Cellone Cellular Services in October 2002.
8.3. The Act was amended vide Ordinance dated
24.1.2000 to include the power to fix the terms and conditions
of interconnectivity between service providers (Section
F 11(1)(b)(ii) of the amended Act).
8.4. The Authority issued Telecommunication
Interconnection (Reference Interconnect Offer) Regulation, 2002
on 12.7.2002 and mooted the idea of an Interconnect Gateway
G Switch. On 15.5.2003, the Authority issued a consultation paper
stating that if one of the parties demands direct connectivity it
needs to be made mandatory through regulations. On
30.6.2003, the Authority called upon stakeholders to discuss
the issue of direct connectivity. Thereafter, the Authority issued
H direction dated 22. 7.2003 under Section 13 of the Act to all
BHARAT SANCHAR NIGAM LTD v. TELECOM 1019
REGULATORY AUTH. OF INDIA [G.S. SINGHVI; J.]
service providers directing that direct connectivity be made A
between service providers at the earliest and not later than
three months from the issue of the direction so as to promote
network efficiency and consumer interest.
8.5. BSNL filed Appeal No. 31/2003 challenging direction
dated 22.7.2003 on the ground that the same was contrary to 8
the terms and conditions of the license agreements of basic
and cellular operators.
8.6. The Authority issued IUC Regulations dated
29.10.2003 mandating direct connectivity between service C
providers. As per clause (b) of Schedule II, charges could be
levied through mutual negotiations but they were to be lower
than Rs.0.20. BSNL issued Circular dated 28.1.2004 levying
charge of Rs.0.4 per minute for a call from cellular mobile
network to another cellular network transited by BSNL. This D
charge included Rs.0.30 towards call termination and Rs.0.19
towards transit.
8.7. The Authority released Consultation Paper on
Interconnect Exchange cum Inter-Carrier Billing Clearance E
House for Multi-Operator Multi-Service Scenario on 13.4.2004
mooting Interconnect Exchange as an alternative to direct
connectivity.
8.8. COAi filed Petition No. 20/2004 seeking a direction
against BSNL CellOne to directly connect to the Cellular F
Service Providers and to strike down the BSNL Circular
requiring payment of Rs 0.19 transit charges which BSNL Basic
Services Division was demanding and collecting.
8.9. TDSAT allowed Appeal No.31/2003 and partly G
allowed petition No.20/2004 and quashed direction dated
22.7.2003 on the ground that the Authority cannot issue
direction resulting in modification of the licence issued after
2000 amendment. TDSAT held that fixation of the terms and
conditions of interconnectivity and ensuring effective H
1020 SUPREME COURT REPORTS [2013] 12 S.C.R.
A interconnectivity is part of the legislative mandate of the
Authority under Section 11 (1 )(b)(ii) and (iii). TDSAT referred
to its earlier order dated 27.4.2005 passed in Appeal Nos. 11
and 12/2002 and held that the amendment of the Act does not
override the law laid down by the Delhi High Court in MTNL v.
8 TRAI (supra). TDSAT further held that the power vested in the
Authority could be exercised in harmony with the terms of
interconnectivity of licenses issued after the 2000 amendment
and the principles laid down in the High Court judgment. With
reigard to the claim of COAi, TDSAT held that though BSNL was
C justified in collecting Rs.0.19 transit charges from Level I TAX ·
to termination of calls in PSTN network or for providing
interconnectivity to networks of other service providers, it was
not justified in charging transit charges to the extent of Rs.0.19
for transit calls from, Level I TAX to Cellone's Gateway MSC.
TDSAT held that it cannot direct BSNL to implement direct
D connectivity as the Authority did not have the power to override
license terms and conditions for making the same mandatory
either by direction under Section 13 or by regulation under
Section 36.
E Civil Appeal Nos.5834-5836 and 5837 of 2005
9.1. These appeals are directed against order dated
27.4.2005 passed by TDSAT whereby it allowed Petition No.
9 of 2001 filed by Association of Basic Telecom Operators and
others and Petition No. 3/2001 filed by Cellular Operators
F Association of India, dismissed Petition No. 12/2003 filed by
private BSOs as withdrawn and dismissed Appeal No. 5/2002
filed by BSNL. '
9.2. Access charges to be paid by the Basic Licensees
G to the DoT (now BSNL) were provided for in tender document
issued on 16.1.1995 at the rate of Rs 0.64 per MCU for STD
calls and Rs 0.87 per MCU for ISO calls. Clarification was
issued on 27.5.1996 reducing the charges to Rs 0.50 per MCU
for STD calls and Rs 0.70 per MCU for ISO calls.
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1021
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
9.3. In 1997-98 interconnect agreements were signed A
between Basic Operators and the then DoT providing for
payment of interconnect charges including port charges at a
minimum of Rs 54,000/- per PCM termination per annum for a
period of 3 years and then actual/full cost based rates, and
access charges at Rs 0.50 per MCU for STD calls and Rs 0.70 B
per MCU for ISO calls. By 1.8.1999 all BSOs migrated to the
revenue sharing regime instead of the fixed license fee regime.
Port charges in respect of Cellular Mobile Service Providers
were prescribed by the DoT vide Circulars dated 27.9.1996
and 5.6.1998 which extended that arrangement for computation c
of port charges which was incorporated in interconnection
agreements signed with private BSOs to CMSPs.
9.4. The; Authority issued Telecommunication
Interconnection (Charges and Revenue Sharing) Regulation,
1999 (hereinafter 'Interconnection Regulations 1999') vide D
notification dated 28.5.1999 by which the port charges as also
the access charges were reduced. Clause 8 of the Regulations
provided that the Regulations would have an over-riding effect
on the interconnect agreements entered into between the
operators and DoT/BSNL. Consequent to the issuing of E
Interconnect Regulations 1999, DoT issued circulars dated
1.10.1999, 12.10.1999 and 25.10.1999 altering the post
charges and access charge~. That clause was struck down by
Delhi High Court in MTNL v: TRAI (supra).
F
9.5. After its creation on 1.10.2000, BSNL issued
communic!&tions dated 28.4.2001 and 31.5.2001 requesting an
increase in the access charges, making the regime of payment
dependent on actual work done by the concerned operator. The
BSOs made a representation to the Authority objecting to this G
increase.
9.6. AUSPJ filed Petition No. 9/2001 before TDSAT
challenging communications dated 28.4.2001 and 31.5.2001,
Vide interim order dated 10.7.2001, AUSPI was directed to
continue paying the admitted amounts. AUSPI paid the port H
1022 SUPREME COURT REPORTS (2013] 12 S.C.R.
A charges and access charges under Interconnect Regulations,
1999 and hence BSNL issued circulars dated 2.11.2001 and
21.11.2001 for recovery of the amounts calculated on the basis
of the interconnect agreements stating that in light of the Delhi
High Court judgement, letter dated 12.10.1999 issued by DoT
s· on the basis of Interconnection Regulations 1999 had become
null and void. As per this circular, BSNL revised retrospectively
w.e.f. 1.5.1999 port charges to be levied from CMSPs at rates
prevailing prior to 1.5.1999. Thereupon, AUSPI amended
Petition No. 9/2001 and challenged circular dated 2.11.2001
c apart from the applicable rates of port charges. COAi separately
filed Petition No.3/2002 for quashing circular dated 2.11.2001.
9.7. During the pendency of those petitions, the Authority
issued Telecommunication Interconnection (Charges and
Revenue Sharing) Regulation, 2001on14.12.2001 which dealt
D only with access charges. These regulations were challenged
by BSNL in Appeal No. 5/2002. the Authority thereafter issued
Telecommunication Interconnection (Port Charges) Regulation,
2001 fixing rates of port charges w.e.f. 28.12.2001. These
regulations were accepted and adopted by all the parties.
E
9.8. Private BSOs filed Petition No. 12/2003 challenging
the applicable rate of port charges for period till issuance of
Port Charges Regulation dated 28.12.2001. By an order dated
27 .4.2005, TDSAT allowed Petition Nos. 9/2001 and 3/2002
F and quashed circular dated 2.11.2001 by observing that the
demands raised therein are without basis. It held that the BSOs
and CMSPs were liable to pay charges as per the DoT letter
dated 12.10.1999 till the coming into effect of the Authority Port
Charges Regulations, 2001. TDSAT dismissed Petition No.12/
G 2003 filed by private BSOs as withdrawn. It also dismissed
Appeal No.5/2002 filed by BSNL and upheld the validity of the
Interconnection Regulatio·ns, 2001 on the ground that they had
become necessary to bring about certainty in the access
charges regime and it could not be said that the Authority acted
unfairly or arbitrarily to enrich private operators.
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1023
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
Civil Appeal Nos. 2731, 2794 and 3504 of 2006. A
10.1. The Authority issued direction dated 22. 7.2003
under Section 13 of the Act to all service providers directing
that direct connectivity be made between service providers at
the earliest and not later than three months from the issue 'of
the direction so as to promote network efficiency and consumer B
interest.
10.2. BSNL filed Appeal No. 31/2003 challenging direction
dated 22.7.2003 on the ground that the same was contrary to
the terms and conditions of the license agreements of basic C
and cellular operators.
10.3. In October 2003, the Authority issued Telecom
Interconnection Usages Charges Regulations (IUC
Regulations) mandating direct connectivity between service
0
providers. As per clause (b) of Schedule II, charges could be
levied through mutual negotiations subject to the condition that
they shall not exceed Rs.0.20 per minute. BSNL issued Circular
dated 28.1.2004 levying charge of Rs 0.4 per minute for a call
from cellular mobile network to another cellular network transited
by BSNL. This charge includes Rs 0.30 towards call termination E
and Rs 0.19 towards transit.
10.4. BSNL issued Circular dated 2.7.2004 to its telecom
circles informing them of its decision to permit direct
connectivity with the BSNL Cellular Network. Reliance lnfocom F
was one of the UASL operators who had sought such
connectivity. NLD and ILD operators were permitted to establish
direct connectivity with CellOne network vide BSNL Circular
dated 4.8.2004. Vide Circular dated 23.8.2004, Reliance was
given direct interconnect as NLDO/ILDO on the same terms and G
conditions as Bharti Televentures Ltd.
10.5. COAi filed Petition No. 20/2004 seeking a direction
against BSNL CellOne to directly connect to the Cellular
Seri/ice Providers and to strike down the BSNL Circular
H
1024 SUPREME COURT REPORTS [2013) 12 S.C.R.
A requiring payment of Rs 0.19 as transit charges which BSNL
Basic Services Division was demanding and collecting.
10.6. Vide order dated 3.5.2005, TD SAT allowed Appeal
No. 31/2003 and quashed direction dated 22.7.2003 holding
that the direction mandating direct connectivity resulted in
B modification of license conditions of licenses issued after the
2000 amendment and as such this was not in accordance with
the provision of the Act. TDSAT partly allowed Petition No. 20/
2004 and held that BSNL was not justified in charging transit
charges to the extent of Rs 0.19 for transit calls from, Level I
C TAX to Cellone's Gateway MSC. Relief of refund of amounts
already collected was not granted.
10. 7. In compliance of TDSAT's order, the Authority issued
Telecom Regulatory Authority of India (Transit Charges for
o Bharat Sanchar Nigam Limited's CellOne Terminating Traffic)
Regulation, 2005 (10 of 2005) dated 8.6.2005 under Section
36 read with section 11 (1 )(b)(ii), (iii) and (iv) clarifying that no
transit charges shall be levied by BSNL on cellular operators
for accessing CellOne subscribers wherever MSCs of both
E CellOne and private CMSPs are connected to the same BSNL
switch.
1o.8. Bharti Televentures Ltd. made representation dated
18.5.2005 to BNL to extend the benefit of Tribunal's brder dated
3.5.2005. It also submitted representation dated 13.6.2005 to
F the Authority to amend regulations dated 8.6.2005 extending
the waiver to fixed line service providers. Thereupon, fresh
Addenda II was inserted into the Interconnect Agreement
between Bharti and BSNL on 5.7.2005 which deals with the
issue of direct connectivity and payment of transit charges.
G
10.9. BSNL extended benefit of the judgment dated
3.5.2005 to Tata Teleservices Limited in May 2005 on the
ground that it was similarly situated as the cellular operators.
However, in October 2005 it withdrew the benefit and
H demanded that Tata pay transit charges at Rs 0.19 on the
BHARAT SANCHAR NIGAM LTD v. TELECOM 1025
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
ground that Tata could not avail of the benefit of the judgment A
·as it was a UAS licensee and not a CMSP.
10.10. BSNL forwarded a draft Addenda to the
Interconnect Agreement to Reliance lnfocom Limited on
14.3.2005. The same was signed by the parties on 17.11.2005 B
for NLD services and on 6.1.2006 as UASL operator. Reliance
filed representation before the Authority dated 30.8.2005 to
extend regulation date 8.6.2005 to UAS licensees also. This
request was declined by the Authority on 6.9.2005. In light of
decision dated 11.11.2005 passed by TDSA T mandating level C
playing filed and reciprocity between service providers and the
subsequent the Authority directive dated 16.11.2005 applying
this judgment to all service providers although the petitioners
had been only cellular operators, Reliance filed another
representation dated 12.12.2005 but did not get any response
from the Authority. D
10.11. Bharti Televentures Limited filed Appeal No. 8/2005
seeking extension of the benefit of order dated 3.5.2005 and
also for modification of the regulations and for extension of the
benefit to similarly situated UAS Licensees. E
10.12. By an order dated 10.2.2006, TDSAT dismissed
the appeal and held that the transit charges would be
deter)llined by the interconnect agreement voluntarily entered
into between Bharti and BSNL post judgment dated 3.5.2005. F
However, TDSAT did not go into the issue of whether basic
service providers can be construed as similarly situated to
cellular operators.
10.13. Bharti Televentures Limited challenged the
aforesaid order in Review Application No. 1/2006, which was G
dismissed vide order dated 3.5.2006.
10.14. Tata Teleservices Limited filed Petition No. 132/
2005 praying for extending the benefit of order dated 3.5.2005,
setting aside the demands of BSNL for Rs 0.19 as transit H
1026 SUPREME COURT REPORTS [2013) 12 S.C.R.
A charges and modification of the regulations. That petition.was
dismissed by TDSAT vide order dated 3.5.2006 on the ground
that similar appeal filed by Bharti Televentures Limited had been
dismissed. Appeal No.7/2006 filed by Reliance lnfocom
Limited was also dismissed by TDSAT by relying upon the
B orders passed in the cases of Bharti Televentures Limited and
Tata Teleservices Limited.
Civil Appeal Nos. 4965-66 of 2007. 177 and 598-599 of
2008
C 11.1. The Authority issued the 4th amendment to the IUC
Regulations on 6.1.2005. Soon thereafter, BSNL issued circular
dated 29.1.2005 for implementation of the Regulations stating
in Annexure 2 that revenue shall be shared between BSNL and
the private operator in the ratio of 50:50 for international
D roaming calls. COAi filed representations dated 31.1.2005,
7.2.2005, 8.2.2005 and 14.2.2005 against this circular. The
Authority issued letter dated 31.1.2005 to BSNL inviting it to
attend a discussion on the implementation of ILJC Regulations
with regard to separate trunk group for handing over roaming
E calls. In light of this, BSNL issued Circular dated 1.2.2005
deferring the formation on trunk group to 14.2.2005 for national
roaming calls and to 7.2.2005 for international roaming calls.
The matter was deferred further to 14.2.2005 and then to
28.2.2005 vide Circulars dated 8.2.2005 and 14.2.2005.
F 11.2. However, by some further correspondence, the
Authority soughl c:o-mments from all- service prolliders on
11.3.2005 on the issues of levy of ADC and revenue sharing
on roaming subscriber traffic. It moved a consultation paper on
17.3.2005 to address the issue of revenue share arrangement
G between terminating network and visiting network. BSNL
submitted its comments on this paper on 10.5.2005. In the
meanwhile, the Authority issued 5th amendment to the IUC
Regulations on 11.4.2005 making ADC applicable to national
calls at Rs 0.30 per minute and international roaming calls at
H Rs 3.25 per minute. The amendment was implemented by
BHARAT SANCHAR NIGAM LTD v. TELECOM 1027
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
BSNL vide Circular dated 9.5.2005. The amendment as it A
related to application of ADC was challenged by COAi in
Appeal No. 7/2005 which was allowed vide order dated
21.9.2005. Thereafter, BSNL withdrew circular dated 9.5.2005
vide circular dated 13.10.2005.
B
11.3. On 23.6.2006, the Authority issued 6th amendment
to IUC Regulations. BSNL issued Circular dated 28.2.2006 for.
implementation of the 6th amendment and provided for higher
termination charges for roaming calls. Thereupon, COAi filed
complaints before BSNL and also before the Authority C
regarding higher termination charges for roaming calls. The
Authority issued letter dated 20.4.2006 to BSNL along with
complaints filed by COAi and M/s BPL. Complaint of Bharti
was also forwarded vide letter dated 24.4.2006. Despite
agreeing to discuss the matter with the private operators, BSNL
started raising bills as per the circular. COAi and others made D
representations dated 24.5.2006 and 12.6.2006 against thee
demands. BSNL replied to the Authority's letter vide letter dated
28.4.2006 staling that the license agreements provide fe>r
revenue share and the circular was strictly in accordance with
the same. E
11.4. Vide decision dated 11.9.2006, the Authority
rejected the claim of BSNL for revenue sharing in respect of
roaming calls and directed BSNL to charge Rs 0.30 per minute
·. for termination of national and international roaming calls as F
prescribed in IUC Regulations.
11.5. BSNL filed Appeal No. 14/2006 challenging the
Authority's decision dated 11.9.2006 on the ground of lack of
jurisdiction. COAi also filed Appeal No.16/2006 challenging the
decision of the Authority insofar as it was made prospective. G
11.6. During the pendency of the appeals, the Authority
notified Telecommunication Tariff (forty fourth amendment)
Order, 2007 on 24.1.2007 fixing maximt1m permissible charges
for national roaming calls. H
1028 SUPREME COURT REPORTS [2013) 12 S.C.R.
A 11.7. After hearing the parties, TDSAT vide order dated
24.8.2007 dismissed Appeal Nos. 14 and 16 of 2006 and
Petition No.319/2006 and held that the decision taken by the
Authority was legally correct and justified.
11.8. The Authority filed MA No. 121/2007 for correction
8
of order dated 24.8.2007 for deletion of the words "admitted"
from para 6 line 12 and "and is recommendatory" from para 9
line 24. MA was allowed vide impugned order dated 12.9.2007
and the words "and is recommendatory'' were deleted. TDSAT
C held that functions enumerated in Section 11 (1 )(b) cannot be
said to be part of the recommendatory power which is
contained in Section 11(1)(a).
11.9. COAi and others filed EA No. 21/2007 seeking
implementation of TDSA T's order dated 24.8.2007 and
D claiming benefit of the Authority order from 11.9.2006 when it
was issued and refund of the amounts collected contrary to the
same. EA was allowed vide impugned order dated 28.11.2007
and BSNL was directed to refund the amounts collected in
excess of the Authority decision dated 11.9.20!>. Tribunal held
E that by virtue of its order, the Authority decision would be
operative prospectively from the date on which it was issued
and especially in light of the absence of stay, BSNL was not
entitled to collect any sum contrary to the Authority decision and
cannot now take advantage of its wrong.
F Civil Appeal Nos. 271-281 of 2011
12.1. These appeals have been filed for setting aside final
judgment and order dated 29.9.2010 passed by TDSAT
whereby it disposed off Appeal Nos. 4/2006; 6/2006; 5/2007;
G 5/2008; 2-8/2009 and remanded the matter to the Authority with
a direction to consider the matter relating to IUC Regulations
afresh.
12.2. The Authority issued Telecommunication
H Interconnection (Charges and Revenue Sharing) Regulation
BHARAT SANCHAR NIGAM LTD v. TELECOM 1029
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
(No. 5 of 2001) - basic framework for regulating access A
charges on 14.12.2001. Separate Regulation for regulating
port charges was issued by the Authority in Dec 2001. On
24.1.2003, the Authority issued Telecom Interconnection Usage
Charges Regulation, 2003 according to which termination
charges were fixed at Rs 0.30 per minute (metro) and Rs 0.40 B
(circle). The concept of Access Deficit Charge (ADC) was also
introduced at 30% of the total sectoral revenue - fee paid by
private operators to cross subsidise BSNL for deploying its
fixed network in non-lucrative areas.
12.3. On receipt of representation dated 4.2.2003 by COAi · C
about the anomalies in the 2003 IUC Regulations, the Authority
undertook a review on 29.10.2003 and reduced the termination
charges to a uniform rate, i.e., Rs. 0.30 per minute for all types
of calls and the ADC was made 10%. The representation made
by COAi for further reduction in the amount of termination D
- charges was, however, rejected by the Authority.
12.4. Between 2005 and 2008, 5 amendments were made
and in the matter of payment of ADC on 9.3.2009, the Authority
notified IUC (Amendment Regulations, 2009) fixing termination E
charge at Rs 0.20 per minute for local and national long
distance calls and mobile telephone services. These regulations
. were challenged by BSNL and various private operators by filing
separate appeals, the details of which are given below:
F
Appeal Appellant Details of Appeal
No.
Appeal BSNL Challenged the IUC Regulations, 2006
No. alleging denial of payment of ADC by
6/2006 TRAI and prescription of uniform termina- G
lion charges when cost of calls termina-
ting in wireless netwbrk is almost 1/3rd of
calls on the wireline network.
Appeal BSNL Challenged the 8th Amendment dt.
H
1030 SUPREME COURT REPORTS [2013] 12 S.C.R.
A No. 21.3.2007 to the extent of reduction of 5/
2007 ADC payable to BSNL and fixation of
uniform termination charges (Mobile
Termination Charge and Fixed
Termination Charge).
B Appeal BSNL Challenged the 9th Amendment di.
No. 27.3.2008 to the extent of reduction of
5/2008 ADC payable to BSNL and fixation of
uniform termination charges.
Appeal COAi Challenging the Regulatii)ns, 2006 to the
c No. ' extent that Mobile Termination Charge at
4/2006 Rs. 0.30 per minute has been maintained
which is not cost based as stated by
TRAI. .
Appeal BSNL Seeking setting aside of the Regulation
D No. di. 9.3.2009 to the extent of fixation of
2/2009 termination charges and carriage charge.
Appeal AUSPI Seeking setting aside of Regulation dt.
No. 9.3.2009. Review of termination charge,
3/2009 transit charge and port charge.
E
Appeal Vodafone Seeking setting aside of Regulation dt.
No. 9.3.2009. Reduce termination charge to
4/2009 35 paise or remand for fresh considera-
.
tion by TRAI. Determine MTC using
Forward looking long range increment
F cost (FL-LRIC). Take in to account
CAPEX, OPEX, common cost and cost
of capital mark up listed under the
heading "International Practice in Cost
Modelling" which is very well established.
G Not to offset this cost by applying amount
attributable to revenue earned from
provision of telecom services including
VAS in determining MTC.
Appeal M/s Similar to Vodafone.
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1031
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
No. Bharati Additionally, increase termination A
5/2009 Airtel charges on international roaming.
Determination of transit charge/carriage
charge from level II TAX to SDCC and
Intra SDCA and TAX transit charge on
basis of cost principles. B
Appeal M/s Idea Similar to M/s Bharati Airtel
No. Cellular
6/2009 Ltd.&
Ors.
Appeal M/s Aircel Similar to Vodafone. c
No. Ltd. &
7/2009 Ors.
Appeal Etisalat Seeking setting aside of Regulation di.
No. D.B. 9.3.2009. Direction to TRAI to: re-
. 8/2009 Telecom introduce termination charges based on D
(P) Ltd. whether operator is a new entrant and
had fulfilled roll out obligation; determine
MTC at not more then 09 paise per
minute and FTC at not more than 10
paise per minute; fix TAX transit charge E
at not more than 02 paise; reduce long
distance carriage charge to not more
than 11 paise per minute; fix 'nil' charge
for receipt of interconnect SMS traffic on
the receiving telecom network. F
12.5. By an order dated 12.5.2009, TDSAT dismissed
Appeal Nos. 6/2006, 5/2007 and 5/2008. However, by the
impugned order some of the appeals were disposed of and
the matter was remanded to the Authority with a direction to G
consider the matter afresh and complete the consultation
process in a time bound manner so that the new IUC charges
could be made effective/implemented by 1.1.2011.
H
1032 SUPREME COURT REPORTS [2013] 12 S.C.R.
A Transferred Case No.39 of 2010
13.1. The transferred case is Letters Patent Appeal
No.337/2007 titled TRAI v. Telecom Dispute Settlement
Appellate Tribunal and another, which was filed before the
B Division Bench of the Delhi High Court against order dated
23.12.2005 passed by the learned Single Judge in Writ Petition
No.2838/2005.
13.2. The Authority enacted the Telecommunication
Interconnection Usage Charges Regulation 2003 (4 of 2003)
C on 29.10.2003 under Section 36 read with Section 11(1)(b)(ii),
(iii) and (iv). These regulations were amended vide notifications
dated 25.11.2003, 12.12.2003 and 31.12.2003 and 6.1.2005.
By the last amendment, provision was made for modification
of the method and manner of charging Access Deficit Charges
D
13.3. MTNL filed Appeal No. 3/2006 for quashing the
amendment made in 2005 on the premise that its entitlement
to Access Deficit Charges had been arbitrarily reduced. On
notice by TDSAT, the Authority raised a preliminary objection
E to the former's jurisdiction. TDSAT relied upon various
provisions of the Act, the judgments of this Court in Clariant
International Limited v. Security Exchange Board (2004) 8
SCC 524, Cellular Operators Association of India v. Union of
India (2003) 3 SCC 186 and West Bengal Electivity
Regulatory Commission v. CESC Ltd (2002) 8 SCC 715 and
F held that the Authority is empowered to frame regulations
circumscribed by the statutory provisions and that it has no
authority to frame regulations in respect of matters not
specifically provided for and in such matters only TDSAT had
the jurisdiction to issue directions.
G
14. Before proceeding further, we may notice the
background in which the Act was enacted. In India, the first
telegraph link was established in 1939 between Calcutta and
Diamond Harbour. In 1851, the telegraph line was opened for
H traffic but it was largely confined to the work of East India ·
BHARAT SANCHAR NIGAM LTD v. TELECOM 1033
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
Company. The Indian Telegraph Act was enacted in 1885. It A
gave exclusive privilege of establishing, maintaining and
working of telegraphs to the Central Government, which was
also empowered to grant licence to private persons to establish
telegraph network in any part of India.
B
15. After Independence, the Government of India took
complete control of the telecom sector and brought it under the
· Post and Telegraph Department. One major step taken for
improving telecommunication services in the country was the
establishment of a modern telecommunication manufacturing C
facility at Bangalore under the public sector, in the name of
"Indian Telephone Industries Ltd". 1984 represents an important
milestone in the development of telecommunication sector. In
. that year, the Centre for Development of Telematies ("C-DoT")
was set up for developing indigenous technologies and licences
were given to the private sector to manufacture subscriber- D
equipment. In 1986, Mahanagar Telephone Nigam Ltd. and
Videsh Sanchar Nigam Ltd. ("VSNL") were set up. In July 1992
a decision was taken to allow private investment for the
services like electronic mail, voicemail, data services, audio text
services, video text services, video conferencing, radio paging E
and cellular mobile telephone.
16. In February 1993, the Finance Minister in his Budget
speech announced Government's intention to encourage
private sector involvement and participation in Telecom to F
supplement efforts of Department of Telecommunications
especially in creation of internationally competitive industry. On
13.5.1994, National Telecom policy was announced which was
placed in Parliament saying that the aim of the policy was to
supplement the effort of the Department of Telecommunications G
in providing telecommunications services. The main objectives
of that policy were:
"(i) affording telecommunication for all and ensuring the
availability of telephone on demand;
H
1034 SUPREME COURT REPORTS [2013] 12 S.C.R.
A (ii) providing certain basic telecom services at affordable
and reasonable prices to all people and covering all
villages;
(iii) giving world standard telecom services; addressing
consumer complaints, dispute resolution and public
B
interface to receive special attention and providing the
widest permissible range of services to meet the
customers' demand and at the same time at a reasonable
price;
C (iv) creating a major manufacturing base and major export
of telecom equipment having regard to the country's size
and development; and
(v) protecting the defence and security interests of the
0 country."
17. With the entry of private operators into telecom sector,
proper regulation of the sector was considered appropriate. An
important step in the institutional reform of Indian telecom
sector was setting up of an independent regulatory authority,
E i.e., Telecom Regulatory Authority. Initially, it was proposed to
set up the Authority as a non-statutory body and for that purpose,
the Indian Telegraph (Amendment) Bill, 1995 was introduced
and was passed by Lok Sabha. However, when the matter was
.taken up in Rajya Sabha, the members expressed the view that
F the Authority should be set up as a statutory body. Keeping that
in view as also the 22nd Report of the Standing Committee on
Communications, the Telecom Authority of India Ordinance,
1996 was promulgated. In Delhi Science Forum v. Union of
India (1996) 2 SCC 405, this Court took cognizance of some
G of the provisions contained in the Ordinance and observed:
"The existence of a Telecom Requlatorv Authority with the
appropriate powers is essential for introduction of plurality
in the Telecom sector. The National Telecom Policy is a
historic departure from the practice followed during the
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1035
REGULATORY AUTH. 9F INDIA [G.S. SINGHVI, J.]
past centurv. Since the private sector will have to contribute A
more to the development of the telecom network than DoT/
MTNL in the next few years. the role of an independent
Telecom Regulatory Authority with appropriate powers
need not be impressed. which can harness the individual
appetite for private gains. for social ends. The Central B
Government and the Telecom Regulatory Authority have
not to behave like sleeping trustees. but have to function
as active trustees for the public good."
(emphasis supplied) C
18. The 1996 Ordinance was replaced by the Act. The
main purpose of establishing the Authority as a statutory body
was to ensure that the interest of consumers are protected and,
at the same time, to create a climate for growth of
'telecommunications, broadcasting and cable services in such D
a manner which could enable India to play leading role in the
emerging global information society. The goals and objectives
of the Authority are as follows:
i. Increasing tele-density and access to E
telecommunication services in the country at
affordable prices.
ii. Making available telecommunication services which
in terms of range, price and quality are comparable
to the best in the world. F
iii. Providing a fair and transparent policy environment
which promotes a level playing field and facilitates
fair competition.
iv. Establishing an interconnection regime that allows G
fair, transparent, prompt and equitable
interconnection.
v. Re-balancing tariffs so that the objectives of
H
1036 SUPREME COURT REPORTS (2013) 12 S.C.R.
A affordability and operator viability are met in a
consistent manner.
vi. Protecting the interest of consumers and
addressing general consumer concerns relating to
availability, pricing and quality of service and other
B
matters.
vii. Monitoring the quality of service provided by the
various operators.
c viii. Providing a mechanism for funding of net cost
areas/ public telephones so that Universal Service
Obligations are discharged by telecom operators
for spread of telecom facilities in remote and rural
areas.
D ix. Preparing the grounds for smooth transition to an
era of convergence of services and technologies.
x. Promoting the growth of coverage Clf radio in India
through commercial and noncommercial channels.
E
xi. Increasing consumer choice in reception of TV
channels and choosing the operator who would
provide television and other related services.
19. The Preamble and Sections 3, 11 to ·14, 18, 33, 35,
F 36 and 37 of the Act (unamended) read as under:
"Preamble
An Act to provide for the establishment of the Telecom
Regulatory Authority of India to regulate the
G telecommunication, and services, and for matters
connected therewith or incidental thereto ..
Section 3 • Establishment and incorporation of
Authority-(1) With effect from such date as the Central
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1037
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
Government may, by notification appoint, there shall be A
established, for the purposes of this Act, an Authority to
be called the Telecom Regulatory Authority of India.
(2) The Authority shall be a body corporate by the name
aforesaid, having perpetual succession and a common B
seal, with power, subject to the provisions of this Act, to
acquire, hold and dispose of property, both movable and
immovable, and to contact, and shall, by the said name,
sue or be sued.
(3) The authority shall consist of a C
Chairperson, and not less than two, but not exceeding six
members, to be appointed by the Central Government.
(4) The head office of the Authority shall be at New Delhi.
Section 11. Functions of Authority D
(1) Notwithstanding anything contained in the Indian
Telegraph Act, 1885 the functions of the Authority shall be
to-
E
a. recommend the need and timing for introduction of new
service provider;
b. recommend the terms and conditions of licence to a
service provider;
F
c. ensure technical compatibility and effective inter-
connection between different service providers;
d. regulate arrangement amongst service providers of
sharing their revenue derived from providing G
telecommunication services;
e. ensure compliance of terms and conditions of licence;
f. recommend revocation of licence for non-compliance of
terms and conditions of licence; H
1038 SUPREME COURT REPORTS (2013) 12 S.C.R.
A g. laydown and ensure the time period for providing local
and long distance circuits of telecommunication between
different service providers;
h. facilitate competition and promote efficiency in the
operation of telecommunication services so as to facilitate
B
growth in such services;
i. protect the interest of the consumers
of telecommunication service;
.C j. monitor the quality of service and conduct the periodical
survey of such provided by the service providers;
k. inspect the equipment used in the network and
recommend the type of equipment to be used by the
service providers;
D
I. maintain register of interconnect agreements and of all
such other matters as may be provided in the regulations;
m. keep register maintained under clause (I) open for
E inspectiQn to any member of public on payment of such
fee and compliance of such other requirements as may be
provided in the regulations;
n. settle disputes between service providers;
F o. render advice to the Central Government in the matters
relating to the development of telecommunication
technology and any other matter reliable to
telecommunication industry in general;
p. levy fees and other charges at such rates and in respect
G
of such services as may be determined by regulations;
q. ensure effective compliance of universal service
obligations;
H r. perform such other functions including such
BHARAT SANCHAR NIGAM LTD v. TELEC0M 1039
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
administrative and financial functions as may be entrusted A
to it by the Central Government or as may be necessary
to carry out the provisions of this Act.
(2) Notwithstanding anything contained in the Indian
Telegraph Act, 1885, the Authority may, from time to time,
8
by order, notify in the Official Gazette the rates at which
the telecommunication services within India and outside
India shall be provided under this Act including the rates
at which messages shall be transmitted to any country
outside India;
c
Provided that the Authority may notify different rates for
different persons or class of persons for similar
telecommunication services and where different rates are
fixed as aforesaid the Authority shall record the reasons
therefor. D
(3) While discharging its functions under sub-section (1),
the Authority shall not act against the interest of the
sovereignty and integrity of India, the security of the State,
friendly relations with foreign States, public order, decency E
or morality.
(4) The Authority shall ensure transparency while exercising
its powers and discharging its functions.
12. Powers of Authority to call for information, F
conduct investigations, etc.-(1) Where the Authority
considers it expedient so to do, it may, by order in writing,-
(a) call upon any service provider at any time to furnish in
writing such information or explanation relating to its affairs G
as the Authority may require; or
(b) appoint one or more persons to make an inquiry in
relation to the affairs of any service provider; and
(c) direct any of its officers or employees to inspect the H·
1040 SUPREME COURT REPORTS (2013) 12 S.C.R.
A books of account or other documents of any service
provider.
(2) Where any inquiry in relation to the affairs of a service
provider has been undertaken under sub-section (1 ),-
B (a) every officer of the Government Department, if such
service provider is a department of the Government;
(b) every director, manager, secretary or other officer, if
such service provider is a company; or
c (c) every partner, manager, secretary or other officer, if
such service provider is a firm; or
(d) every other person or body of persons who has had
dealings in the course of business with any of the persons
D mentioned in clauses (b) and (c),
shall be bound to produce before the Authority making the
inquiry, all such books of account or other documents in
his custody or power relating to, or having a bearing on
E the subject-matter of such inquiry and also to furnish to the
Authority with any such statement or information relating
thereto, as the case may be, required of him, within such
time as may be specified.
(3) Every service provider shall maintain such books of
F account or other documents as may be prescribed.
(4) The Authority shall have the power to issue such
directions to service providers as it may consider
necessary for proper functioning by service providers.
G
13. Powers-of Authority to issue directions- The
Authority may, for the discharge of its functions under sub-
section (1) of section 11, issue such directions from time
to time to the service providers, as it may consider
necessary.
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1041
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
14. Authority to settle disputes-(1) If a dispute arises, A
in respect of matters referred to in sub-section (2), among
service providers or between service providers and a
group of consumers, such disputes shall be adjudicated
by a bench constituted by the Ch.airperson and such bench
shall consist of two members; B
Provided that if the members of the bench differ on any
point or points they shall state the point or points on which
they differ and refer the same to a third member for hearing
on such point or points and such point or points shall be C
decided according to the opinion of that member.
(2) The bench constituted under sub-section (1) shall
exercise, on and from the appointed day all such
jurisdiction, powers and authority as were exerciseable
immediately before that date by any D
civil court on any matter relating to-
(i) technical compatibility and inter-connections between
service providers;
E
(ii) revenue sharing arrangements between different
service providers;
(iii) quality of telecommunication services and interest of
consumers;
F
Provided that nothing in sub-section shall apply in respect
of matters relating to-
(a) the monopolistic trade practice, restrictive trade
practice and unfair trade practice which are subject to the G
jurisdiction of the Monopolies and Restrictive Trade
Practices Commission established under sub-section (1)
of section 5 of the Monopolies and Restrictive Trade
Practices Act, 1969;
(b) the complaint of an individual consumer maintainable H
1042 SUPREME COURT REPORTS [:!013) 12 S.C.R.
A before a Consumer Disputes Redressal Forum or a
Consumer Disputes Redressal Commission or the
National Consumer Redressal Commission established
under section 9 of the Consumer Protection Act, 1986;
(c) dispute between telegraph authority and any other
B
person referred to in sub-section (1) of section 78 of the
Indian Telegraph Act, 1885.
18. Appeal to High Court- Any person aggrieved by any
decision or order of the Authority may file an appeal to the
c High Court within thirty days from the date of
communication of the decision or order of the Authority to
him;
Provided that the High Court may, if it is satisfied that the
D appellant was prevented by sufficient cause from filing the
appeal within the said period, allow it to be filed within a
further period not exceeding sixty days.
33. Delegation. - The Authority may, by general or special
order in writing, delegate to any member, officer of the
E Authority or any other person subject to such conditions, if
any, as may be specified in the order, such of its powers
and functions under this Act (except the power to settle
dispute under Chapter IV and to make regulation under
section 36) as it may deem necessary.
F
35.Power to make rules.- (1) The Central government
may, by notification, make rules for carrying out the
purposes of this Act.
(2) In particular and without prejudice to the generality of
G the foregoing power, such rules may provide for all or any
of the following matters, namely;-
(a) the salary and allowances payable to and the other
conditions of service of the Chairperson and members
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1043
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
under sub-section (5) of section 5; A
(b) the powers and functions of the Chairperson under
subsection (1) of section 6;
(c) the procedure for conducting an inquiry made under
subsection (2) of section 7; B
(d) the category of books of accounts or other documents
which are required to be maintained under sub-section (3)
of section 12;
(e) the period within which an application is to be made
c
under sub-section (1) of section 15;
(f) the manner in which the accounts of the Authority shall
be maintained under sub-section (1) of section 23;
D
(g) the time within which and the form and manner in which
returns and report are to be made to the Central
Government under sub-section (1) and (2) of section 24;
(h) any other matter which is to be, or may be, prescribed,
or in respect of which provision is to be made, by rules; E
36. Power to make regulations.-(1) The Authority may,
by notification, make regulations consistent with this Act
and the rules made thereunder to carry out the purposes
~~ F
(2) In particular, and without prejudice to the generality of
the foregoing power, such regulations may provide for all
or any of the following matters, namely:-
(a) the times and places of meetings of the Authority and G
the procedure to be followed at such meetings under
subsection (1) of section 8, including quorum necessary
for the transaction of business;
(b) the transaction of business at the meetings of the H
1044 SUPREME COURT REPORTS (2013) 12 S.C.R.
A Authority under sub-section (4) of section 8;
(c) the salaries and allowances payable to and the other
conditions of service of officers and other employees of
the Authority under sub-section (2) of section 1O;
B (d) matters in respect of which register is to be maintained
by the Authority under clause (I) of sub-section (I) of section
11;
(e) levy of fee and lay down such other requirements on
c fulfilment of which a copy of register may be obtained under
clause (m) of sub-section (I) of section 11;
(f) levy of fees and other charges under clause (p) of
subsection (1) of Section 11.
D 37. Rules and regulations to laid before Parliament. -
Every rule and every regulation made under this Act shall
be laid, as soon as may be after it is made, before each
House of Parliament, while it is in session, for a total period
of thirty days which may be comprised in one session or
E in two or more successive sessions, and if, before the
expiry of the session immediately following the session or
the successive sessions aforesaid, both Houses agree in
making any modification in the rule or regulations or both
Houses agree that the rule or regulation should not be
F made, the rule or regulation shall thereafter have effect only
in such modified form or be of no effect, as the case may
be; so, however, that any such modification or annulment
shall be without prejudice to the validity of anything
previously done under that rule or regulation."
G 20. With a view to overcome the difficulties experienced
in the implementation of the Act, the Central Government
constituted a Group on Telecom and IT Convergence under the
Chairmanship of the Finance Minister. The recommendations
made by the Group led to the issuance of the Telecom
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1045
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
Regulatory Authority of India (Amendment) Ordinance, 2000, A
·which was replaced by the Telecom Regulatory Authority of India
(Amendment) Act, 2000. One of the important features of the
Amendment Act was the establishment of a Tribunal known as
the Telecom Disputes Settlement and Appellate Tribunal for
adjudicating disputes between a licensor and a licencee, B
between two or more service providers, between a service
provider and a group of consumers, and also to hear and
dispose of any appeals from the direction, decision or order
of the Authority.
21. The provisions of the amended Act, which have bearing C
on the decision of the question framed in the opening paragraph
of this judgment are as under: ·
"2. Definitions. -(1) )()()( )()()(
)()()( D
(aa) "Appellate Tribunal" means the Telecom Disputes
Settlement and Appellate Tribunal established under
section 14;
(b) "Authority" means the Telecom Regulatory Authority of E
India established under sub- section (1) of section 3;
(e) "Licensee" means any person licensed under sub-
section (1) of section 4 of the Indian Telegraph Act, 1885
(13 of 1885) for providing specified public F
telecommunication services;
(ea) "licensor" means the Central Government or the
telegraph authority who grants a license under section 4
of the Indian Telegraph Act, 1885;
G
(i) "regulations" means regulations made by the Authority
under this Act;
O> "service provider" means the Government as a service
provider and includes a licensee; H
1046 SUPREME COURT REPORTS (2013) 12 S.C.R.
A (k) "telecommunication service" means service of any
description (including electronic mail, voice mail, data
services, audio tax services, video tax services, radio
paging and cellular mobile telephone services) which is
made available to users by means of any transmission or
B reception of signs, signals, writing, images and sounds or
intelligence of any nature, by wire, radio, visual or other
electro- magnetic means but shall not include broadcasting
services:
Provided that the Central Government may notify other
c service to be telecommunication service including
broadcasting services.
11. Functions of Authority .-(1) Notwithstanding
anything contained in the Indian Telegraph Act, 1885 (13
D of 1885), the functions of the Authority shall be to-
(a) make recommendations, either suo motu or on a
request from the licensor, on the following matters,
namely-
E (i) need and timing for introduction of new service provider;
(ii) terms and conditions of licence to a service provider;
(iii) revocation of licence for non-compliance of terms and
conditions of licence;
F
(iv) measures to facilitate competition and promote
efficiency in the operation of telecommunication services
so as to facilitate growth in such services;
G (v) technological improvements in the services provided
by the service providers;
(vi) type of equipment to be used by the service providers
after inspection of equipment used in the network;
H (vii) measures for the development of telecommunication
BHARAT SANCHAR NIGAM LTD v. TELECOM 1047
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.] ·i::
-:.~ r.~
technology and any other matter relatable~_~to A
telecommunication industry in general; -·
(viii) efficient management of available spectrumi - ·
(b) discharge the following functions, namely-
'.· B
(i) ensure compliance of terms and conditions of licen~t
(ii) notwithstanding anything contained in the terms and
conditions of the licence granted before tile
commencement of the Telecom Regulatory Authority of
India (Amendment) Act, 2000, fix the terms and conditions C
of interconnectivity between the service providers;
(iii) ensure technical compatibility and effective inter-
connection between different service providers;
D
(iv) regulate arrangement amongst service providers of
sharing their revenue derived from providing
telecommunication services;
(v) lay down the standards of quality of service to be
provided by the service providers and ensure the quality E
of service and conduct the periodical survey of such
service provided by the service providers so as to protect
interest of the consumers of telecommunication service;
(vi) lay down and ensure the time period for providing local F
and long distance circuits of telecommunication between
different service providers;
(vii) maintain register of interconnect agreements and of
all such other matters as may be provided in the
regulations; G
(viii) keep register maintained under clause (vii) open for
inspection to any member of public on payment of such
fee and compliance of such other requirement as may be
provided in the regulations; H
1048 SUPREME COURT REPORTS [2013] 12 S.C.R.
A (ix) ensure effective compliance of universal service
obligations;
(c) levy fees and other charges at such rates and in respect
of such services as may be determined by regulations;
B (d) perform such other functions including such
administrative and financial functions as may be entrusted
to it by the Central Government or as may be necessary
to carry out the provisions of this Act:
c Provided that the recommendations of the Authority
specified in clause (a) of this sub-section shall not be
· binding upon the Central Government:
Provided further that the Central Government shall seek the
recommendations of the Authority in respect of matters
D specified in sub-clauses (i) and (ii) of clause (a) of this
sub-section in respect of new licence to be issued to a
service provider and the Authority shall forward its
recommendations within a period of sixty days from the
date on which that Government sought the
E recommendations:
Provided also that the Authority may request the Central
Government to furnish such information or documents as
may be necessary for the purpose of making
F recommendations under sub-clauses (i) and (ii) of clause
(a) of this sub-section and that Government shall supply
such information within a period of seven days from receipt
of such request:
Provided also that the Central Government may issue a
G licence to a service provider if no recommendations are
received from the Authority within the period specified in
the second proviso or within such period as may be
mutually agreed upon between the Central Government
and the Authority:
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1049
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
Provided also that if the Central Government having A
considered that recommendation of the Authority, comes
to a prima facie conclusion that such recommendation
cannot be accepted or needs modifications, it shall refer
the recommendation back to the Authority for its
reconsideration, and the Authority may, within fifteen days B
from the date of receipt of such reference, forward to the
Central Government its recommendation after considering
the reference made by that Government. After receipt of
further recommendation if any, the Central Government
shall take a final decision. c
(2) Notwithstanding anything contained in the Indian
Telegraph Act, 1885 (13of1885), the Authority may, from
time to time, by order, notify in the Official Gazette the rates
at which the telecommunication services within India and
outside India shall be provided under this Act including the D
rates at which messages shall be transmitted to any
country outside India:
Provided that the Authority may notify different rates for
different persons or class of persons for similar E
telecommunication services and where different rates are
fixed as aforesaid the Authority shall record the reasons
therefor.
(3) While discharging its functions under sub-section (1 ), F
or sub-section (2) the Authority shall not act against the
interest of the sovereignty and integrity of India, the security
of the State, friendly relations with foreign States, public
order, decency or morality.
(4) The Authority shall ensure transparency while exercising G
its powers and discharging its functions.
12. Powers of Authority to call for information,
conduct investigations, etc. - (1) Where the Authority
H
1050 SUPREME COURT REPORTS [2013] 12 S.C.R.
A considers it expedient so to do, it may, by order in writing,-
(a) call upon any service provider at any time to furnish in
writing such information or explanation relating to its affairs
as the authority may require; or
B (b) appoint one or more persons to make an inquiry in
relation to the affairs of any service provider; and
(c) direct any of its officers or employees to inspect the
books of account or other documents of any service
c provider.
(2) Where any inquiry in relation to the affairs of a service
provider has been undertaken under sub-section (1 ),-
(a) every officer of the Government Department, if such
D service provider is a department of the Government;
(b) every director, manager, secretary or other officer, if
such service provider is a company; or
(c) every partner, manager, secretary or other officer, if
E such service provider is a firm; or
(d) every other person or body of persons who has had
dealings in the course of business with any of the persons
mentioned in clauses (b) and (c),
F
shall be bound to produce before the Authority making the
inquiry, all such books of account or other documents in
his custody or power relating to, or having a bearing on
the subject-matter of such inquiry and also to furnish to the
Authority with any such statement or information relating
G
thereto, as the case may be, required of him, within such
time as may be specified.
(3) Every service provider shall maintain such books of
account or other documents as may be prescribed.
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1051
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.)
(4) The Authority shall have the power to issue such A
directions to service providers as it may consider
necessary for proper functioning by service providers.
13. Power of Authority to issue directions.-The
Authority may, for the discharge of its functions under sub- 8
section (1) of section 11, issue such directions from time
to time to the service providers, as it may consider
necessary:
Provided that no direction under sub-section (4) of Section
12 or under this section shall be issued except on the C
matters specified in clause (b) of sub-section (1) of
Section 11 ."
14. Establishment of Appellate Tribunal.-The Central
Government shall, by notification, establish an Appellate D
Tribunal to be known as the Telecom Disputes Settlement
and Appellate Tribunal to-
(a) adjudicate any dispute-
(i)between a licensor and a licensee; E
(ii)between two or more service providers;
(iii) between a service provider and a group of
consumers;
F
Provided that nothing in this clause shall apply in respect
of matters relating to-
(A) the monopolistic trade practice, restrictive trade
practice and unfair trade practice which are subject to the G
jurisdiction of the Monopolies and Restrictive Trade
Practices Commission established under sub-section (1)
of section 5 of the Monopolies and Restrictive Trade
Practices Act, 1969 (54 of 1969);
(B) the complaint of an individual consumer maintainable H
1052 SUPREME COURT REPORTS [2013) 12 S.C.R.
A before a consumer Disputes Redressal forum or a
Consumer Disputes Redressal Commission or the
National Consumer Redressal commission established
under section 9 of the Consumer Protection Act, 1986 (68
of 1986);
B
(C) dispute between telegraph authority and any other
person referred to in sub-section (1) of section 78 of the
Indian Telegraph Act 1885 (13 of 188!i);
·(b) hear and dispose of appeal against any direction,
c decision or order of the Authority under this Act.
14A. Application for settlement of disputes and
appeals to Appellate Tribunal.-
(7) The Appellate Tribunal may, for the purpose of
D examining the legality or propriety or correctness of any
dispute made in any application under sub-section (1), or
of any direction or order or decision of the Authority
referred to in the appeal preferred under sub-section (2),
on its own motion or otherwise, call for the records relevant
E to disposing of such applications or appeal and make
such orders as it thinks fit.
14M. Transfer of pending cases.--All applications,
pending for adjudication of disputes before the Authority
F immediately before the date of establishment of the
Appellate Tribunal under this Act, shall stand transferred
on that date to such Tribunal:
Provided that all disputes being adjudicated under the
provisions of Chapter IV as it stood immediately before
G the commencement of the Telecom Regulatory Authority
(Amendment) Act, 2000, shall continue to be adjudicated
by the Authority in accordance with the provisions,
contained in that Chapter, till the establishment of the
Appellate Tribunal under the said Act:
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1053
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
Provided further that all cases referred to in the first A
provision shall be transferred by the Authority to the
Appellate Tribunal immediately on its establishment under
section 14.
14N. Transfer of appeals.-(1) All appeals pending 8
before the High Court immediately before the
commencement of the Telecom Regulatory Authority
(Amendment) Act, 2000, shall stand transferred to the
Appellate Tribunal on its establishment under section 14.
(2) Where any appeal stands transferred from the High
Court to the Appellate Tribunal under sub-section (1 ),- C
(a) the High Court shall, as soon as may be after such
transfer, forward the records of such appeal to the
Appellate Tribunal; and
D
(b) the Appellate Tribunal may, on receipt of such records,
proceed to deal with such appeal, so far as may be from
the stage which was iyached before such ,transfer or from
any earlier stage or de novo as the Appellate Tribunal may
deem fit. E
18. Appeal to Supreme Court-(1) Notwithstanding
anything contained in the Code of Civil Procedure, 1908
(5 of 1908) or in any other law, an appeal shall lie against
any order, not being an interlocutory order, of the Appellate
Tribunal to the Supreme Court on one or more of the F
grounds specified in section 100 of that Code.
(2) No appeal shall lie against any decision or order made
by the Appellate Tribunal with the consent of the parties.
(3) Every appeal under this section shall be preferred G
within a period of ninety days from the date of the decision
or order appealed against:
Provided that the Supreme Court may entertain the appeal
after the expiry of the said period of ninety days, if it is H
1054 SUPREME COURT REPORTS [2013] 12 S.C.R.
A satisfied that the appellant was prevented by sufficient
cause from preferring the appeal in time.
33. Delegation. - The Authority may, by general or special
order in writing, delegate to any member, officer of the
Authority or any other person subject to such conditions, if
B
any, as may be specified in the order, such of its powers
and functions under this Act (except the power to settle
dispute under Chapter IV and to make regulation under
section 36) as it may deem necessary.
c 35. Power to make rules.-ill The Central Government
may, by notification, make rules for carrying out the
purposes of this Act.
(2) In particular, and without prejudice to the generality of
D the foregoing power, such rules may provide for all or any
of the following matters namely:-
(a) the salary and allowances payable to and the other
conditions of service of the Chairperson and members
under sub-section (5) of section 5;
E
(aa) the allowance payable to the parl··time members under
sub-section (6A) of section 5;
(b) the powers and functions of the Chairperson under sub-
section (1) of section 6;
F
(c) the procedure for conducting an inquiry made under
sub- section (2) of section 7;
(ca) the salary and allowances and other conditions of
G service of officers and other employees of the Authority
under sub-section (2) of section 1O;
(d) the category of books of account or other documents
which are required to be maintained under sub-section (3)
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1055
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
of section 12; A
(da) the form, the manner of .its verification and the fee
under sub-section (3) of section 14A;
(db) the salary and allowances payable to and other terms
and conditions of service of the Chairperson and other B
Members of the Appellate Tribunal under section 14E;
(de) the salary and allowances and other conditions of
service of the officers and employees of the Appellate
Tribunal under sub-section (3) of section 14H; c
(dd) any other power of a civil court required to be
prescribed under clause (i) of sub-section (2) of section
16;
(e) the period within which an application is to be made D
under sub-section (1) of section 15;
(f) the manner in which the accounts of the Authority shall
be maintained under sub-section (1) of section 23;
(g) the time within which and the form and manner in which E
returns and report are to be made to the Central
Government under sub-sections (1) and (2) of section 24;
(h) any other matter which is to be, or may be, prescribed,
or in respect of which provision is to be made, by rules. F
36. Power to make regulations.-ill The Authority may,
by notification, make regulations consistent with this Act
and the rules made thereunder to carry out the purpose of
this Act. G
(2) In particular, and without prejudice to the generality of
the foregoing power, such regulations may provide for all
or any of the following matters, namely:-
H
1056 SUPREME COURT REPORTS [2013) 12 S.C.R.
A (a) the times and places of meetings of the Authority and
the procedure to be followed at such meetings under sub-
section (1) of section 8, including quorum necessary for
the transaction of business;
(b) the transaction of business at the meetings of the
B
Authority under sub-section (4) of section 8;
(c) omitted by Act 2 of 2000
(d) matters in respect of which register is to be maintained
c by the Authority under clause (I) of sub-section (1) of
section 11;
(e) levy of fee and lay down such other requirements on
fulfilment of which a copy of register may be obtained under
sub clause (b) of sub- section (1) of section 11;
D
(f) levy of fees and other charges under clause (c) of sub-
section (1) of section 11.
37. Rules and regulations to laid before Parliament. -
E Every rule and every regulation made under this Act shall
be laid, as soon as may be after it is made, before each
House of Parliament, while it is in session, for a total period
of thirty days which may be comprised in one session or
in two or more successive sessions, and if, before the
expiry of the session immediately following the session or
F
the successive sessions aforesaid, both Houses agree in
making any modification in the rule or regulations or both
Houses agree that the rule or regulation should not be
made, the rule or regulation shall thereafter have effect only
in such modified form or be of no effect, as the case may
.G be; so, however, that any such modification or annulment
shall be without prejudice to the validity of anything
previously done under that rule or regulation."
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1057
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
22. A comparative statement of the relevant provisions of A
the unamended and amended Acts is given below:
UNAMENDED ACT AMENDED ACT
PREAMBLE PREAMBLE B
An Act to provide for the An Act to provide for the
establishment of the Telecom establishment of the Telecom
Regulatory Authority of India Regulatory Authority of India
to regulate the and the Telecom Disputes c
telecommunication services,· Settlement and Appellate
and for matters connected Tribunal to regulate the
therewith or incidental telecommunication services,
thereto. adjudicate disputes, dispose
of appeals and to protect the D
interests of service providers
and consumers of the
telecom sector, to promote
and ensure orderly growth of
the telecom sector and for E
matters connected therewith
or incidental thereto.
Section 3. Section 3
Establishment and Establishment and
incorporation of incorporation of F
Authority.-(1) With effect Authority.-(1) With effect
from such date as the Central from such date as the Central
Government may, by Government may, by
notification appoint, there notification appoint, there
shall be established, for the shall be established, for the G
purposes of this Act, an purposes of this Act, an
Authority to be called the Authority to be called the
Telecom Regulatory Authority Telecom Regulatory Authority
of India. of India.
H
1058 SUPREME COURT REPORTS (2013] 12 S.C.R.
A (2) The Authority shall be a (2) The Authority shall be a
body corporate by the name body corporate by the name
aforesaid, having perpetual aforesaid, having perpetual
succession and a common succession and a common
seal, with power, subject to seal, with power, subject to
B the provisions of this Act, to the provisions of this Act, to
acquire, hold and dispose of acquire, hold and dispose of
property, both movable and property, both movable and
immovable, and to contract, immovable, and to contract,
and shall, by the said name, and shall, by the said name,
c sue or be sued. sue or be sued.
(3) The Authority shall consist (3) The Authority shall consist
of a Chairperson, and not of a Chairperson, and not
less than two, but not more than two whole-time
exceeding six members, to members and not more than
D be appointed by the Central two part-time members, to be
Government. appointed by the Central
(4) The head office of the Government.
Authority shall be at New (4) The head office of the
Delhi. Authority shall be at New
E Delhi.
Section 11. Section 11.
F Functions of Authority.-(1) Functions of Authority.-(1)
Notwithstanding anything Notwithstanding anything
contained in the Indian contained in the Indian
Telegraph Act, 1885 the Telegraph Act, 1885 (13 of
functions of the Authority shall 1885), the functions of the
G be to- • Authority shall be to-
(a) recommend the need and (a) make recommendations,
timing for introduction of either suo motu or on a
new service provider; request from the licensor,
(b) recommend the terms on the following matters,
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1059
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
and conditions of licence namely:- A
to a service provider;
(i) need and timing for
(c) ensure technical introduction of new
compatibility and effective service provider;
inter-connection between
(ii) terms and conditions B
different service
of licence to a
providers;
service provider;
(d) regulate arrangement
(iii) revocation of licence
amongst service
for non-compliance
providers of sharing their c
of terms and
revenue derived from
conditions of licence;
providing
telecommunication (iv) measures to
services; facilitate competition
and promote
(e) ensure compliance of D
efficiency in the
terms and conditions of
operation of
licence;
telecommunication
(f) recommend revocation of services so as to
licence for non- facilitate growth in
compliance of terms and such services; E
conditions of licence;
(v) technological
(g) lay down and ensure the improvements in the
time period for providing services provided by
local and long distance the service
F
circuits of providers;
telecommunication
(vi) type of equipment to
between different service
be used by the
providers;
service providers
(h) facilitate competition and after inspection of G
promote efficiency in the equipment used in
operation of the network;
telecommunication
(vii) measures for the
services so as to facilitate
development of
growth in such services; H
telecommunication
1060 SUPREME COURT REPORTS [2013] 12 S.C.R.
A (i) protect the interest of the technology and any
consumers of other matter relatable
telecommunication to telecommunication
service; industry in general;
Q) monitor the quality of (viii) efficient management
B service and conduct the of available
periodical survey of such spectrum;
provided by the service
(b) discharge the
providers;
following functions,
C (k) inspect the equipment namely:-
used in the network and
(i) ensure compliance of
recommend the type of
terms and conditions
equipment to be used by
of licence;
the service providers;
(ii) n otwiths tan ding
o (I) maintain register of
anything contained in
interconnect agreements
the terms and
and of all such other
conditions of the
matters as may be
licence granted
provided in the
before the
E regulations;
commencement of
(m) keep register maintained the Telecom
under clause (I) open for Regulatory Authority
inspection to any member of India (Amendment)
of public on payment of Act, 2000, fix the
F such fee and compliance terms and conditions
of such other of inter-connectivity
requirements as may be between the service
provided in the providers;
regulations;
(iii) ensure technical
G (n) settle disputes between compatibility and
service providers; effective inter-
connection between
(o) render advice to the
different service
Central Government in the
providers;
matters relating to the
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1061
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
development of (iv) regulate arrangement A
telecommunication amongst service
technology and any other providers of sharing
matter relatable to their revenue derived
telecommunication from providing
industry in general; telecommunication B
(p) levy fees and other services;
charges at such rates and (v) lay-down the
in respect of such standards of quality of
services as . may be service to be provided
determined by by the service c
regulations; providers and ensure
(q) ensure effective the quality of service
compliance of universal and conduct the
service obligations; periodical survey of
such service provided D
(r) perform such other by the service
functions including such providers so as to
administrative and protect interest of the
financial functions as may consumers of
be entrusted to it by the telecommunication E
Central Government or as service;
may be necessary to
carry out the provisions of (vi) lay-down and ensure
this Act. the time period for
providing local and
(2) Notwithstanding anything long distance circuits F
contained in the Indian of telecommunication
Telegraph Act, 1885, the between different
Authority may, from time to service providers;
time, by order, notify in the
Official Gazette the rates at (vii) maintain register of
G
which the telecommunication interconnect
services within India and agreements and of all
outside India shall be such other matters as
provided under this Act may be provided in the
including the rates at which regulations;
H
1062 SUPREME COURT REPORTS [2013] 12 S.C.R.
A messages shall be (viii) keep register
transmitted to any country maintained under
outside India; clause (vii) open for
Provided that the Authority inspection to any
may notify different rates for member of public on
B different persons or class of payment of such fee
persons for similar and compliance of
telecommunication services such other
and where different rates are requirement as may
fixed as aforesaid the be provided in the
C Authority shall record the regulations;
reasons therefor. (ix) ensure effective
(3) While discharging its compliance of
functions under sub-section universal service
(1 ), the Authority shall not act obligations;
0
against the interest of the (c) levy fees and other
sovereignty and integrity of charges at such rates
India, the security of the and in respect of such
State, friendly relations with services as may be
foreign States, public order, determined by
E decency or morality. regulations;
(4) The Authority shall ensure (d) perform such othe~
transparency while exercising functions including such
its powers and discharging administrative and
its functions. financial functions as
F
may be entrusted to it by
the Central Government
or as may be necessary
to carry out the
provisions of this Act:
G
Provided that the
recommendations of the
Authority specified in clause
(a) of this sub-section shall not
H be binding upon the Central
BHARAT SANCHAR NIGAM LTD v. TELECOM 1063
REGULATORY AUTH. OF INDIA [G.S. SINGHVI; J.]
Government: A
Provided further that the
Central Government shall
seek the recommendations
of the Authority in respect of
matters specified in sub-
B
clauses (i) and (ii) of clause
(a) of this sub-section in
respect of new licence to be
issued to a service provider
and the Authority shall c
forward its
recommendations within a
period of sixty days from the
date on which that
Government sought the D
recommendations:
Provided also that the
Authority may request the
Central Government to
furnish such information or E
documents as may be
necessary for the purpose of
making recommendations
under sub-clauses (i) and (ii)
of clause (a) of this sub- F
section and that Government
shall supply such information
within a period of seven days
from receipt of such request:
G
Provided also that the
Central Government may
issue a licence to a service
provider if no
recommendations are
H
1064 SUPREME COURT REPORTS [2013) 12 S.C.R.
A received from the Authority
within the period specified in
the second proviso or within
such period as may be
mutually agreed upon between
B the Central Government and
the Authority:
Provided also that if the
Central Government having
considered that
c recommendation of the
Authority, comes to a prima
facie conclusion that such
recommendation cannot be
accepted or needs
D modifications, it shall, refer the
recommendation back to the
Authority for its
reconsideration, and the
Authority may within fifteen
E days from the date of receipt
of such reference, forward to
the Central Government its
recommendation after
considering the reference
made by that Government.
F
After receipt of further
recommendation if any, the
Central Government shall take
a final decision.
G (2) Notwithstanding anything
contained in the Indian
Telegraph Act, 1885 (13 of
1885), the Authority may, from
time to time, by order, notify in
H the Official Gazette the rates at
BHARAT SANCHAR NIGAM LTD v. TELECOM 1065
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
which the telecommunication A
services within India and
outside India shall be provided
under this Act including the
rates at which messages shall
be transmitted to any country B
outside India:
Provided that the Authority may
notify different rates for
different persons or class of
persons for similar c
telecommunication services
and where different rates are
fixed as aforesaid the Authority
shall record the reasons
therefor. D
(3) While discharging its
functions under sub-section (1)
or sub-section (2) the Authority
shall not act against the interest
of the sovereignty and integrity E
of India, the security of the
State, friendly relations with
foreign States, public order,
decency or morality.
F
(4) The Authority shall ensure
transparency while exercising
its powers and discharging its
functions.
G
Section 13 Section 13
Powers of Authority to Power of Authority to issue
issue directions.- The directions.- The Authority may,
H
1066 SUPREME COURT REPORTS [2013] 12 S.C.R.
A Authority may, for the for the discharge of its
discharge of its functions functions under sub-section
under sub-section (1) of (1) of section 11, issue such
section 11, issue such directions from time to time to
directions from time to time to the service providers, as it
B the service providers, as it may consider necessary:
may consider necessary.
Provided that no direction
under subsection (4) of
section 12 or under this
section shall be issued except
c on the matters specified in
clause (b) of sub-section. (1)
of section 11.
CHAPTER IV CHAPTER IV
D SETTLEMENT OF APPELLATE TRIBUNAL
DISPUTES
Section 14.
Section 14.
Authority to settle Establishment of Appellate
E disputes.· (1) If a dispute Tribunal.- The Central
arises, in respect of matters Government shall, by
referred to in sub-section (2), notification, establish an
among service providers or Appellate Tribunal to be
between service providers known as the Telecom
F and a group of consumers, Disputes Settlement and
such disputes shall be Appellate Tribunal to-
adjudicated by a bench (a) adjudicate any dispute-
constituted by the
Chairperson and such bench (i) between a licensor and a
G shall consist of two members: licensee;
Provided that if the members (ii) between two or more
of the bench differ on any service providers;
point or points they shall state (iii) between a service
the point or points on which provider and a group of
H they differ and refer the same consumers:
BHARAT SANCHAR NIGAM LTD v. TELECOM 1067
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
to a third member for hearing Provided that nothing in this A
•
on such point or points and clause shall apply in respect of
such point or points shall be matters relating to-
decided according to the
(A) the monopolistic trade
opinion of that member.
practice, restrictive trade
(2) The bench constituted practice and unfair trade B
under sub-section (1) shall practice which are subject to
exercise, on and from the the jurisdiction of the
appointed day all such Monopolies and Restrictive
jurisdiction , powers and Trade Practices
authority as were exercisable Commission established c
immediately before that date under subsection (1) of
by any civil court on any section 5 of the Monopolies
matter relating to- and Restrictive Trade
(i) technical compatibility and Practices Act, 1969 (54 of
interconnections between 1969); D
service providers; (B) the complaint of an
(ii) revenue sharing individual consumer
arrangements between maintainable before a
different service providers; Consumer Disputes
Redressal Forum or a E
(iii) quality of Consumer Disputes
telecommunication services Redressal Commission or
and interest of consumers: the National Consumer
Provided that nothing in this Disputes? Redressal
sub-section shall apply in Commission established F
respect of matters relating to- under section 9 of the
Consumer Protection Act,
(a) the monopolistic trade 1986 (68 of 1986);
practice, restrictive trade
practice and unfair trade (C) dispute between
telegraph authority and any G
practice which are
subject to the jurisdiction other person referred to in
of the Monopolies and sub-section (1) of section 78
Restrictive Trade of the Indian Telegraph Act,
Practices Commission 1885 (13 of 1885);
H
1068 SUPREME COURT REPORTS [2013) 12 S.C.R.
A established under sub- (b) hear and dispose of appeal
section ( 1) of Section 5 against any direction, decision
of the Monopolies and or order of the Authority unde•
Restrictive Trade this Act.
Practices Act, 1969 (54
Section 14A ·Application fo1
B of 1969);
settlement of disputes and
(b) the complaint of an appeals to Appellate
individual consumer Tribunal
maintainable before a
(1) The Central Government 01
Consumer Disputes a State Government or a local
c Redressal Forum or a
authority or any person mai
Consumer Disputes
make an application to the
Redressal Commission
or the National
Appellate Tribunal to
adjudication of any dispute
Consumer Disputes?
referred to in clause (a) o
D Redressal Commission
section 14.
established under
section 9 of the (2) The Central Government 01
Consumer Protection a State Government or a local
Act, 1986 (68 of 1986); authority or any person
aggrieved by any direction,
E (c) dispute between
decision or order made by the
telegraph authority and
Authority may prefer an appeal
any other person
to the Appellate Tribunal.
referred to in sub-section
(1) of section 7-B of the (3) Every appeal under sub-
F Indian Telegraph Act, section (2) shall be preferred
1885 (13 of 1885). within a period of thirty days
from the date on which a copi
of the direction or order 01
decision made by the Authoriti
G is received by the Central
Government or the State
Government or the local
authority or the aggrieved
person and it shall be in such
H form, verified in such manne1
BHARAT SANCHAR NIGAM LTD v. TELECOM 1069
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.)
and be accompanied by such A
fee as may be prescribed:
Provided that the Appellate
Tribunal may entertain any
appeal after the expiry of the
said period of thirty days if it is B
satisfied that there was
sufficient cause for not filing it
within that period.
(4) On receipt of an
application under sub-section
c
(1) or an appeal under sub-
section (2), the Appellate
Tribunal may, after giving the
parties to the dispute or the
D
appeal an opportunity of being
heard, pass such orders
thereon as it thinks fit.
(5) The Appellate Tribunal
shall send a copy of every E
order made by it to the parties
to the dispute or the appeal
and to the Authority, as the
case may be.
(6) The .application made F
under subsection (1) or the
appeal preferred under sub-
section (2) shall be dealt with
by it as expeditiously as
possible and endeavour shall G
be made by it to dispose of
the application or appeal finally
within ninety days from the
date of receipt of application
or appeal, as the case may H
1070 SUPREME COURT REPORTS [2013] 12 S.C.R.
A be:
Provided that where any such
application or appeal could
not be disposed of within the
said period of ninety days, the
B Appellate Tribunal shall record
its reasons in writing for not
disposing of the application or
appeal within that period.
c (7) The Appellate Tribunal
may, for the purpose of
examining the legality or
propriety or correctness, of
any dispute made in any
application under sub-section
D (1 ), or of any direction or
order or decision of the
Authority referred to in the
appeal preferred under sub-
section (2), on its own motion
E or otherwise, call for the
records relevant to deposing
of such application or appeal
and make such orders as it
thinks fit.
F
Section 14M - Transfer of
pending cases
All applications, pending for
adjudication of disputes
G before the Authority
immediately before the date
of establishment of the
Appellate Tribunal under this
Act, shall stand transferred on
H that date to such Tribunal:
BHARAT SANCHAR NIGAM LTD v. TELECOM 1071 .
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
Provided that all disputes A
being adjudicated under the
provisions of Chapter IV as it
stood immediately before the
commencement of the
Telecom Regulatory Authority B
of India (Amendment) Act,
2000, shall continue to be
adjudicated by the Authority in
accordance with the
provisions, contained in that C
Chapter, till the establishment
of the Appellate Tribunal under
the said Act:
Provided further that all cases
referred to in the first proviso D
shall be transferred by the
Authority to the Appellate
Tribunal immediately on its
establishment under section
14. E
Section 14N - Transfer Of
appeals
(1) All appeals pending
before the F
High Court immediately
before the
commencement of the
Telecom Regulatory Authority
of India (Amendment) Act, G
2000, shall stand transferred
to the Appellate Tribunal on its
establishment under section
14.
(2) Where any appeal H
1072 SUPREME COURT REPORTS [2013) 12 s.c:R.
A stands transferred from the
High Court to the
Appellate Tribunal under sub-
section (1 ),-
(a) the High Court shall, as
B soon as may be after such
transfer, forward the records
of such appeal to the
Appellate Tribunal; and
(b) the Appellate Tribunal
c may, on receipt of such
records, proceed to deal with
such appeal, so far as may be
from the stage which was
reached before such transfer
D or from any earlier stage or de
novo as the Appellate Tribunal
may deem fit.
E Section 16 Section 16
Procedures and powers of Procedure and powers of
Authority.- (1) The Authority Appellate Tribunal.- (1) The
shall be guided by the Appellate Tribunal shall not be
principles of natural justice. bound by the procedure laid
down by the Code of Civil
F (2) The Authority shall have,
Procedure, 1908 (5 of 1908),
for the purpose of
but shall be guided by the
discharging their functions
principles of natural justice
under this Chapter, the same
and, subject to the other
powers as are vested in a
provisions of this Act, the
G civil court under the Code of
Appellate Tribunal shall have
Civil Procedure, 1908 (5 of
powers to regulate its own
1908) in respect of the
procedure.
following matters, namely
(2) The Appellate Tribunal
H (a) summoning and shall have, for the
BHARAT SANCHAR NIGAM LTD v. TELECOM 1073
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
enforcing the attendance purposes of discharging A
of any person and its functions under this
examining him on oath; Act, the same powers as
(b) requiring the discovery are vested in a civil court
and production of under the Code of Civil
documents; Procedure, 1908 (5 of B
1908), while trying a suit,
(c) receiving evidence on in respect of the following
affidavits; matters, namely:-
(d) issuing commissions for (a) summoning and enforcing
the examination of the attendance of any c
witnesses• or person and examining
documents; him on oath;
(e) reviewing its decisions; (b) requiring the discovery
(f) dismissing an and production of
D
application for default or documents;
deciding it ex parte; (c) receiving evidence on
I
(g) setting aside any order affidavits;
of dismissal of any (d) subject to the provisions
application for default or of sections 123 and 124 E'
any order passed by it of the Indian Evidence
ex parte; Act,1872 (1 of 1872),
(h) any other matter which requisitioning any public
may be prescribed. record or document or a
copy of such record 'Or F
(3) Every proceeding before
document, from any
the Authority shall be deemed
office;
to be a judicial proceeding
within the meaning of (e) issuing commissions for
Sections 193 and 228, and the examination of
witnesses or documents; G
for the purpose of Section
196 of the Indian Penal Code, (f) reviewing its decisions;
1860 (45 of 1860) and the
Authority shall be deemed to (g) dismissing an application
be a civil court for all the for default or deciding it,
H
1074 SUPREME COURT REPORTS [2013] 12 S.C.R.
A purposes of Section 195 and ex parte;
Chapter XXVI of the Code of
(h) setting aside any order of
Criminal Procedure 1973 (2
dismissal of any
of 1974).
application for default or
any order passed by it, ex
B parte; and
(i) any other matter which
may be
prescribed.
c (3) Every proceeding before
the Appellate Tribunal shall be
deemed to be a judicial
proceeding within the
meaning of sections 193 and
D 228, and for the purposes of
section 196 of the Indian Penal
Code (45 of 1860) and the
Appellate Tribunal shall be
deemed to be a civil court for
E the purposes of section 195
and Chapter XXVI of the Code
of Criminal Procedure, 1973
(2 of 1974).
Section 19 Section 19.
F
Orders passed by Orders passed by Appellate
Authority or High Court to Tribunal to be executable as
be executable as a a decree.-(1) An order
decree.- Every order made passed by the Appellate
G by the Authority under this Tribunal under this Act shall be
Act or the order made by the executable by the Appellate
High Court in any appeal Tribunal as a decree of civil
against any order of the court, and for this purpose, the
Authority shall, on a Appellate Tribunal shall have
certificate issued by any all the powers of a civil court.
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1075
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.)
officer of the Authority or the (2) Notwithstanding A
Registrar of the High Court, anything contained in sub-
as the case may be, be section (1), the Appellate
deemed to be decree of the Tribunal may transmit any
civil court and shall be order made by it to a civil
executable in the same court having local jurisdiction B
manner as a decree of that and such civil court
court. shall execute the order as if it
were a decree made by that
court.
Section 20 Section 20 c
Penalty for wilful failure to Penalty for wilful failure to
comply with orders of comply with orders of
Authority or High Court.· If Appellate Tribunal.-lf any
any person wilfully fails to person wilfully fails to comply
comply with the orders of the with the order of the Appellate D
Authority or any order of the Tribunal, he shall be
High Court, as the case may punishable with fine which
be, he shall be punishable may extend to one lakh
with fine which may extend to rupees and in case of a
one lakh rupees and in case second or subsequent E
of a second or subsequent offence with fine which may
offence with fine which may extend to two lakh rupees and
extend to two lakh rupees and in the case of continuing
in the case of continuing contravention with additional
contravention with additional fine which may extend to two F
fine which may extend to two lakh rupees for every day
lakh rupees for every day during which such default
during which the default continues.]
continues.
G
Section 36 Section 36
Power to make Power to make
regulations.-(1) The regulations.-(1)The Authority
Authority may, by notification, may, by notification, make
H
1076 SUPREME COURT REPORTS (2013] 12 S.C.R. '.
A make regulations consistent regulations consistent with
with this Act and the rules this Act and the rules made
made thereunder to carry out thereunder to carry out the
the purposes of this Act. purposes of this Act.
(2) In particular, and without (2) In particular, and without
B prejudice to the generality of prejudice to the generality of
the foregoing power, such· the foregoing power, such
regulations may provide for regulations may provide for all
all or any of the following or any of the following matters,
matters, namely:- namely:-
C (a) the times and places of (a) the times and places of
meetings of the Authority meetings
and the procedure to be of th1~ Authority and the
followed at such procedure to be followed
meetings under sub- at such meetings under
D section (1) of Section 8, sub-section (1) of section
including quorum 8, including quorum
necessary for the necessary for the
transaction of business; transaction of business;
(b) the transaction of (b) the transaction of
E business at the meetings business at the
of the Authority under meetings of the Authority
sub-section (4) of under sub-section (4) of
Section 8; section 8;
F (c) the salaries and )()()(
allowances payable to
(d) matters in respect of
and the other conditions
which register is to be
of service of officers and
maintained by the
other employees of the
authority under sub-
Authority under sub-
G clause (vii) of clause (b)
section (2) of Section 1O;
of sub-section (1) of
(d) matters in respect of section 11;
which register is to be
(e) levy of fee and lay down
maintained by the
such other requirements
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1077
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.)
Authority under clause (I) on fulfilment of which a A
of sub-section (1) of copy of register may be
Section 11; obtained under sub-
(e) levy of fee and lay down clause (viii) of clause (b)
such other requirements of sub-section (1) of
on fulfilment of which a section 11; B
copy of register may be (f) levy of fees and other
obtained under clause changes under clause (c)
(m) of sub-section (1) of of sub-section (1) of
Section 11; section 11;
c
(f) levy of fees and other
charges under clause (p)
of sub-section (1) of
section 11.
23. We shall now deal with the question formulated by this o
Court, the first facet of which relates to the scope of Section
36 of the Act.
24. Shri R.F. Nariman, learned Solicitor General argued
that the power vested in the Authority to make regulations for
carrying out the purposes of the Act is very wide and is not E
controlled by Section 36(2), which provides for framing of
. regulations on specified matters. He submitted that if power is
conferred upon a statutory authority to make subordinate
legislation in general terms, the particularization of the topics
is merely illustrative and does not limit the scope of the general F
power. Learned Solicitor General further argued that for
carrying out the purposes of the Act, the Authority can make
regulations on various matters specified in other sections
including Sections 8(1 ), 8(4), 11 (1 )(b), 12(4) and 13. He
submitted that the regulations made under Section 36(1) and G
(2) are in the nature of subordinate legislation and are required
to be laid before each House of Parliament in terms of Section
37 and Parliament can approve, modify or annul the same. He
further submitted that a restrictive interpretation of Section
36(1) with reference to Clauses (a), (b} and (d) of Section 36(2) H
1078 SUPREME COURT REPORTS [2013] 12 S.C.R.
A will make the provision otiose and the Court should not adopt
that course.
25. Shri AS. Chandhiok, learned senior counsel appearing
for BSNL argued that sub-section (1) of Section 36 should not
be construed as conferring unbridled power upon the Authority
8
to make regulations, else other provisions like Sections 12(4)
and 13, which empower the Authority to issue directions on
certain matters would become redundant. Shri C.S.
Vaidyanathan, learned senior counsel appearing for the
C appellants in C.A Nos.6049/2005, 802/2006, 4523/2006 and
5184/2010 argued that Section 36(1) should be construed
consistent with other provisions of the Act and regulations
cannot be made on the matters covered by other provisions.
He referred to Section 11 (2) and argued that the power
conferred upon the Authority to issue an order fixing the rates
D at which the telecommunication services are to be provided
within and outside India including the rates at which messages
are required to be transmitted to any country outside India and
the power vested in the authority under Section 12(4) and 13
to issue directions to the service providers cannot be controlled
E by making regulations under Section 36(1). Shri Vaidyanathan
emphasized that if Parliament has conferred power upon the
Authority under Section 11 (2) to notify the rates by a transparent
method, the power under Section 36(1) cannot be used for
framing regulation on that topic. Learned senior counsel referred
F to Section 62 of the Electricity Act, 2003, which, according to
him, is pari materia to Section 11 (2) and argued that in view
of paragraph 15 of the judgment in PTC India Limited v.
Central Electricity Regulatory Commission (2010) 4 SCC
603, regulations cannot be framed on the subject specified in
G that section. Dr. AM. Singhvi, learned senior counsel appearing
for the appellants in C.A Nos.271-281/2011 argued that the
operation of Section 36(1) of the Act is controlled by Section
36(2), which provide for framing of regulation in respect of
some ministerial acts required to be performed under the Act
H and argued that the Authority cannot make regulations on the
BHARAT SANCHAR NIGAM LTD v. TELECOM 1079
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
subjects specifically covered by other provisions. Dr. Singhvi A
submitted that the Court should not give an interpretation to
Section 36(1) which will make the Authority an unruly horse and
enable it to style every instrument as a regulation and thereby
exclude the same from challenge before TDSAT. An ancillary
argument made by Dr. Singhvi is that if regulations are framed B
on the topics covered by other provisions of the Act, then
TDSAT will be denuded much of its jurisdiction and the purpose
of creating an independent adjudicatory body will be defeated.
Shri Mukul Rohatgi, learned senior counsel argued that the
scope of Section 36(1) should be confined to the topics c
specified in sub-section (2) thereof, else the same will become
inconsistent with other provisions of the Act including Sections
11(2), (4), 12(4) and 13. Shri Ramji Srinivasan, learned counsel
appearing in some of the appeals, argued that the regulation
making power under Section 36(1) cannot be used for nullifying D
the power of the Authority to issue directions on the topics
specified in Sections 11(1)(b), 11(2), 12(4) and 13.
26. We have considered the respective arguments. Under
the unamended Act, the Authority had the following three types
of functions: E
RECOMMENDATORY FUNCTIONS
Under Section 11 (1) (a) of the TRAI Act 1997, the
Authority is required to make recommendations either suo
moto or on a request from the licensor, i.e., Department F
of Telecommunications or Ministry of Information &
Broadcasting in the case of Broadcasting and Cable
Services.
TRAI has powers to make recommendations either suo G
motu or on request from the licensor on the following
matters as per Section 11 (1 )(a):
(i) need and timing for introduction of new service
provider;
H
1080 SUPREME COURT REPORTS [2013] 12 S.C.R.
A (ii) terms and conditions of licence to a service
provider;
(iii) revocation of licence for non-compliance of terms
and conditions of licence;
B (iv) measures to facilitate competition and promote
efficiency in the operation of telecommunication
services so as to facilitate growth in such services;
(v) technological improvements in the services
c provided by the service providers;
(vi) type of equipment to be used by the service
providers after inspection of equipment used in the
network;
D (vii) measures for the development of
telecommunication technology and any other matter
relatable to telecommunication industry in general;
(viii) efficient management of available spectrum.
E REGULATORY FUNCTIONS
The Authority also had regulatory and tariff setting functions,
like ensuring compliance of terms and conditions of
licence, laying standard of Quality of Service (QoS) to be
F provided by service providers and notifying the rates at
which telecommunication has to be provided and ensuring
effective compliance of USOs. It also had the power to call
upon any service provider at any time to furnish in formation
or explanation, in writing, relating to its affairs. It was
G required to ensure transparency while exercising its
powers and discharging its functions. It was given powers
to punish for violation of its directions.
Another approach was through feedback I representations
received from consumers I consumer organizations,
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1081
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
experts etc. A
These functions could be discharged by the Authority
through a multipronged approach. One of these
approaches was by analyzing the reports received from the
service providers. In certain cases, the Authority could on 8
its own initiative take action for ensuring compliance of
terms and conditions of license.
ADJUDICATORY FUNCTIONS
Originally, TRAI was also empowered to adjudicate upon c
disputes among Service Providers or between the Service
Providers and a group of Consumers on matters relating
to technical compatibility and interconnection between the
Service Providers, revenue sharing arrangement between
Service Providers, quality of telecommunication services D
and interests of consumers.
27. After the amendment of 2000, the Authority can either
suo motu or on a request from the licensor make
recommendations on the subjects enumerated in Section
11(1)(a)(i) to (viii). Under Section 11 (1)(b), the authority is E
required to perform nine functions enumerated in clauses (i) to
(ix) thereof. In these clauses, different terms like 'ensure', 'fix',
'regulate' and 'lay down' have been used. The use of the term
'ensure' implies that the Authority can issue directions on the
particular subject. For effective discharge of functions under F
various clauses of Section 11(1) (b), the authority can frame
· appropriate regulations. The term 'regulate' contained in sub-
clause (iv) shows that for facilitating arrangement amongst
service providers for sharing their revenue derived from
providing telecommunication services, the Authority can either G
issue directions or make regulations.
28. The terms 'regulate' and 'regulation' have been
interpreted in large number of judgments. We may notice few
of them. In V.S. Rice & Oil Mills v. State of AP. AIR 1964 SC H
1082 SUPREME COURT REPORTS (2013] 12 S.C.R.
A 1781, agreements for a period of ten years had been executed
for supply of electricity and the same did not contain any
provision authorising the Government to increase the rates
during their operation. However, in exercise of power under
Section 3(1) of the Madras Essential Articles Control and
B Requisitioning (Temporary Powers) Act, 1949, the State
Government issued order enhancing the agreed rates. The
same was challenged on the ground that any increase in agreed
tariff was out of the purview of Section 3(1). Chief Justice
Gajendragadkar, speaking for the Constitution Bench,
c observed as under:
'The word regulate is wide enough to confer power on the
State to fegufate either by increasing the rate, or
decreasing the rate, the test being what is it that is
necessary or expedient to be done to maintain, increase,
D or secure supply of the essential articles in question and
to arrange for its equitable distribution and its availability
at fair prices. The concept of fair prices to which Section
3(1) expressly refers does not mean that the price once
fixed must either remain stationary, or must be reduced in
E order to attract the power to regulate. The power to regulate
carf be exercised for ensuring the payment of a fair price,
and the fixation of a fair price would inevitably depend upon
a consideration of all relevant and economic factors which
contribute to the determination of such a fair price. If the
F fair price indicated on a dispassionate consideration of all
relevant factors turns out to be higher than the price fixed
and prevailing, then the power to regulate the price must
necessarily include the power to increase so as to make
it fair. Hence the challenge to the validity of orders
G increasing the agreed tariff rate on the ground that they are
outside the purview of Section 3(1) cannot be sustained."
29. In State of Tamil Nadu v. Hind Stone (1981) 2 SCC ·
205, this Court held that the word 'regulate' must be interpreted
H to include 'prohibition' within its fold. Some of the observations
BHARAT SANCHAR NIGAM LTD v. TELECOM 1083
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
made in that judgment (paragraph 10) are extracted below: A
"We do not think that 'regulation' has that rigidity of
meaning as never to take in 'prohibition'. Much depends
on the context in which the expression is used in the statute
and the object sought to be achieved by the contemplated B
regulation. It was observed by Mathew, J. in G.K. Krishnan
v. State of T.N. (1975) 1 SCC 375: 'The word "regulation"
has no fixed connotation. Its meaning differs according to
the nature of the thing to which it is applied.' In modern
statutes concerned as they are with economic and social
activities, 'regulation' must, of necessity, receive so wide C
an interpretation that in certain situations, it must exclude
competition to the public sector from the private sector.
More so in a welfare State. It was pointed out by the Privy
Council in Commonwealth of Australia v. Bank of New
South Wales (1949) 2 All ER - and we agree with what D
was stated therein - that the problem whether an
enactment was regulatory or something more or whether
a restriction was direct or only remote or only incidental
involved, not so much legal as political, social or economic
consideration and that it could not be laid down that in no E
circumstances could the exclusion of competition so as to
create a monopoly, either in a State or Commonwealth
agency, be justified. Each case, it was said, must be
judged on its own facts and in its own setting of time and
circumstances and it might be that in regard to some F
economic activities and at some stage of social
development, prohibition with a view to State monopoly
was the only practical and reasonable manner of
regulation. The statute with which we are concerned, the
Mines and Minerals (Regulation and Development) Act, is G
aimed, as w,e have already said more than once, at the
conservation and the prudent and discriminating
exploitation of minerals. Surely, in the case of a scarce
mineral, to permit exploitation by the State or its agency
and to prohibit exploitation by private agencies is the most H
1084 SUPREME COURT REPORTS [2013] 12 S.C.R.
A effective method of conservation and prudent exploitation.
If you want to conserve for the future, you must prohibit in
the present. We have no doubt that the prohibiting of leases
in certain cases is part of the regulation contemplated by
Section 15 of the Act."
B
30. In K. Ramanathan v. State of Tamil Nadu (1985) 2
SCC 116, this Court interpreted the word 'regulation' appearing
in Section 3(2)(d) of the Essential Commodities Act, 1955 and
observed:
c "The word "regulation" cannot have any rigid or inflexible
meaning as to exclude 'prohibition". The word "regulate"
is difficult to define as having any precise meaning. It is a
word of broad import, having a broad meaning, and is very
comprehensive in scope. There is a diversity of opinion
D as to its meaning and its application to a particular state
of facts, some courts giving to the term a somewhat
restricted, and others giving to it a liberal, construction. The
different shades of meaning are brought out in Corpus
Juris Secundum, Vol. 76 at p. 611:
E "'Regulate' is variously defined as meaning to
adjust; to adjust, order, or govern by rule, method,
or established mode; to adjust or control by rule,
method, or established mode, or governing
principles or laws; to govern; to govern by rule; to
F govern by, or subject to, certain rules or restrictions;
to govern or direct according to rule; to control,
govern, or direct by rule or regulations.
'Regulate' is also defined as meaning to direct; to
G direct by rule or restriction; to direct or manage
according to certain standards, laws, or rules; to
rule; to conduct; to fix or establish; to restrain; to
restrict."
See also: Webster's Third New International Dictionary,
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1085
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
Vol. II, p. 1913 and Shorter Oxford Dictionary, Vol. II, 3rd A
Edn., p. 1784.
It has often been said that the power to regulate does not
necessarily include the power to prohibit, and ordinarily the
word "regulate" is not synonymous with the word "prohibif'. B
This is true in a general sense and in the sense that mere
regulation is not the same as absolute prohibition. At the
same time, the power to regulate carries with it full power
over the thing subject to regulation and in absence of
restrictive words, the power must be regarded as plenary C
over the entire subject. It implies the power to rule, direct
and control, and. involves the adoption of a rule or guiding
principle to be followed, or the making of a rule with
respect to the subject to be regulated. The power to
regulate implies the power to check and may imply the
power to prohibit under certain circumstances, as where D
the best or only efficacious regulation consists of
suppression. It would therefore appear that the word
"regulation" cannot have any inflexible meaning as to
exclude "prohibition". It has different shades of meaning
and must take its colour from the context in which it is used E
having regard to the purpose and object of the legislation,
and the Court must necessarily keep in view the mischief
which the legislature seeks to remedy.
The question essentially is one of degree and it is F
impossible to fix any definite point at which "regulation"
ends and "prohibition" begins. We may illustrate how _
different minds have differently reacted as to the meaning
of the word "regulate" depending on the context in which it
is used and the purpose and object of the legislation. In G
Slattery v. Na/yor LR (1888) 13 AC 446 the question
arose before the Judicial Committee of the Privy Council
whether a Bye-law by reason of its p;ohibiting internment
altogether in a particular cemetery, was ultra vires because
the Municipal Council had only power of regulating
H
1086 SUPREME COURT REPORTS [2013] 12 S.C.R.
A internments whereas the Bye-law totally prohibited them in
the cemetery in question, and it was said by Lord
Hobhouse, delivering the judgment of the Privy Council:
"A rule or Bye-law cannot be Held as ultra vires
B merely because it prohibits where empowered to
regulate, as regulation often involved prohibition."
31. In Jiyajeerao Cotton Mills Ltd. v. M.P. Electricity Board
1989 Supp (2) SCC 52, the validity of the orders providing for
higher charges/tariff for electricity consumed beyond legally
C fixed limit was upheld in view of Section 22(b) of the Electricity
Act, which permits the State Government to issue an
appropriate order for regulating the supply, distribution and
consumption of electricity. It was held that the Court while
interpreting the expression "regulate" must necessarily keep in
D view the object to be achieved and thei mischief sought to be
remedied. The necessity for issuing the orders arose out of the
scarcity of electricity available to the Board for supplying to its
customers and, therefore, in this background the demand for
higher charges/tariff was held to be a part of a regulatory
E measure.
32. In Deepak Theatre v. State of Punjab 1992 Supp (1)
SCC 684, this Court upheld classification of seats and fixation
of rates of admission according to the paying capacity of a
cinegoer by observing that the same is an integral part of the
F power to make regulation and fixation of rates of admission
became a legitimate ancillary or incidental power in furtherance
of the regulation under the Act.
33. The term 'regulation' was also interpreted in Quarry
G Owners' Association v. State of Bihar (2000) 8 SCC 655 in the
context of the provisions contained in the Mines and Minerals
(Regulation Development) Act, 1957 and it was held:
"Returning to the present case we find that the words
"regulation of mines and mineral development" are
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1087
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
incorporated both in the Preamble and the Statement of A
Objects and Reasons of this Act. Before that we find that
the Preamble of our Constitution in unequivocal words
expresses to secure for our citizens social, economic and
political justice. It is in this background and in the context
of the provisions of the Act, we have to give the meaning B
of the word "regulation". The word "regulation" may have
a different meaning in a different context but considering
it in relation to the economic and social activities including
the development and excavation of mines, ecological and
environmental factors including States' contribution in c
developing, manning and controlling such activities,
including parting with its wealth, viz., the minerals, the
fixation of the rate of royalties would also be included within
its meaning."
34. Reference in this connection can also be made to the D
judgment in U.P. Coop. Cane Unions Federation v. West U.P.
Sugar Mills Association (2004) 5 SCC 430. In that case, the
Court interpreted the word 'regulation' appearing in U.P.
Sugarcane (Regulation of Supply and Purchase) Act, 1953 and
observed: E
" "Regulate" means to control or to adjust by rule or to
subject to governing principles. It is a word of broad impact
having wide meaning comprehending all facets not only
specifically enumerated in the Act, but also embraces F
within its fold the powers incidental to the regulation
envisaged in good faith and its meaning has to be
ascertained in the context in which it has been used and
the purpose of the statute."
35. It is thus evident that the term 'regulate' is elastic G
enough to include the power to issue directions or to make
regulations and the mere fact that the expression "as may be·
provided in the regulations" appearing in clauses (vii) and (viii)
of Section·11(1)(b) has not been used in other clauses of that
sub--section does not mean that the regulations cannot be H
1088 SUPREME COURT REPORTS [2013] 12 S.C.R.
A framed under Section 36(1) on the subjects specified in
clauses (i) to (vi) of Section 11 (1 )(b). In fact, by framing
regulations under Section 36, the Authority can facilitate the
exercise of functions under various clauses of Section 11 (1)(b)
including clauses (i) to (vi).
B
36. We may now advert to Section 36. Under sub-Section
(1) thereof the Authority can make regulations to carry out the
purposes of the Act specified in various provisions of the Act
including Sections 11, 12 and 13. The exercise of power under
C Section 36(1) is hedged with the condition that the regulations
must be consistent with the Act and the Rules made thereunder.
There is no other restriction on the power of the Authority to
make regulations. In terms of Section 37, the regulations are
required to be laid before Parliament which can either approve,
modify or annul the same. Section 36(2), which begins with the
D words "without prejudice to the generality of the power under
sub-section (1 )" specifies various topics on which regulations
can be made by the Authority. Three of these topics relate to
meetings of the Authority, the procedure to be followed at such
meetings, the transaction of business at the meetings and the
E register to be maintained by the Authority. The remaining two
topics specified in Clauses (e) and (f) of Section 36(2) are
directly referable to Section 11(1)(b)(viii) and 11(1)(c). These
are substantive functions of the Authority. However, there is
nothing in the language of Section 36(2) from which it can be
F inferred that the provisions contained therein control the exercise
of power by the Authority under Section 36(1) or that Section
36(2) restricts the scope of Section 36(1 ).
37. It is settled law that if power is conferred upon an
authority/body to make subordinate legislation in general terms,
G the particularization of topics is merely illustrative and does not
limit the scope of general power. In Emperor v. Sibnath Banerji
AIR 1942 PC 156, the Privy Council considered the correctness
of the judgment of the Federal Court, which held that Rule 26
of the Defence of India Rules framed under clause 0) of Section
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1089
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
3(2) of the Defence of India Act, 1939 was ultra vires the A
provisions of the Act. While reversing the judgment of the
Federal Court, the Privy Council observed:
"In the opinion of their Lordships, the function of sub-section
(2) is merely an illustrative one; the rule-making power is B
conferred by sub-section (1 ), and "the rules" which are
referred to in the opening sentence of Sub-section (2) are
the . Rules which are authorized by, and made under, sub-
section (1 ); the provisions of sub-section (2) are not
restrictive of Sub-section (1 ), as, indeed is expressly C
stated by the words "without prejudice to the generality of
the powers conferred by sub-section (I)."
38. The proposition laid down in Sibnath Banerji's case
was followed by this Court in large number of cases. In Afzal
Ullah v. State of Uttar Pradesh 1964 (4) S.CR 991, the D
Constitution Bench considered challenge to 'the validity, of bye-
law No.3 framed by Municipal Board, Tanda. The appellant had
questioned the bye-law on the ground that the same was ultra
vires the provisions of Section 241 of the United Provinces
Municipalities Act, 1916. The facts of that case were that the E
appellant had established a market for selling food-grains,
vegetables, fruits, fish etc. The Chairman of the Municipal Board
issued a notice to the appellant requiring him to obtain a licence
for running the market with an indication that if he fails to do
so, criminal proceedings will be initiated against him. On F
account of his failure to take the required licence, the appellant
was tried by Tahsildar, Tanda in Criminal Case No.141 of 1960.
The Tahsildar acquitted the appellant on the ground that the
prosecution had failed to prove the fact that in the market
established on the land belonging to the appellant, vegetables, G
fruits and fish were sold. The order of acquittal was set aside
by the High Court and the appellant was convicted under
Section 299(1) of the 1916 Act read with clause (3) of the
relevant bye-laws. In the appeal filed before this Court, it was
argued that bye-law 3(a) and other bye-laws passed by the H
1090 SUPREME COURT REPORTS [2013] 12 S.C.R.
A Board are ultra vires the provisions of Section 241 of the Act.
The Constitution Bench referred to the provisions of Sections
241 and 298 of the Act and various clauses of Section 298(2)
which specify the topics on which bye-laws can be framed and
observed:
B
"Even if the said clauses did not justify the impugned Bye-
law, there can be little doubt that the said Bye-laws would
be justified by the general power conferred on the Boards
by Section 298(1 ). It is now well-settled that the specific
provisions such as are contained in the several clauses
c of Section 298(2) are merely illustrative and they cannot
be read as restrictive of the generality of powers
prescribed by Section 298(1 l (vide Emperor v. Sibnath
Banerji). If the powers specified by Section 298(1) are very
wide and they take in within their scope Bye-laws like the
D ones with which we are concerned in the present appeal,
it cannot be said that the powers enumerated under
Section 298(2) control the general words used by Section
298(1 ). These latter clauses merely illustrate and do not
exhaust all the powers conferred on the Board. so that any
E cases not falling within the powers specified by Section
298(2) may well be protected by Section 298(1). provided.
of course. the impugned Bye-law can be justified by-
reference to the requirements of Section 298(1 l. There can
be no doubt that the impugned Bye-laws in regard to the
F markets framed by Respondent 2 are for the furtherance
of municipal administrate ion under the Act, and so, would
attract the provisions of Section 298t 1). Therefore, we are
satisfied that the High Court was right in coming to the
conclusion that the impugned Bye-laws are valid."
G
(emphasis supplied)
39. In Rohtak Hissar District Electricity Supply Company
Ltd. v. State of Uttar Pradesh and others AIR 1966 SC 1471,
this Court dealt with the rule making power of the State
H Government under the Uttar Pradesh Industrial Disputes Act,
BHARAT SANCHAR NIGAM LTD v. TELECOM 1091
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
1947 and observed: A
"Section 15(1 l confers wide powers on the appropriate
Government to make rules to carrv out the purposes of the
Act: and Section 15(2) specifies some of the matters
enumerated by clauses (a) to (el. in respect of which rules B
may be framed. It is well-settled that the enumeration of
the particular matters by sub-section (2) will not control or
limit the width of the power conferred on the appropriate
Government by sub-section (1) of Section 15: and so. if it
appears that the item added by the appropriate
Government has relation to conditions of employment. its C
addition cannot be challenged as being invalid in law."
(emphasis supplied)
40. In K. Ramanathan v. State of Tamil Nadu (supra), a D
three-Judge Bench of this Court considered the scope of
Section 3(1), (2) and Section 5 of the Essential Commodities
Act, 1955. The appellant and other agriculturists of Tanjavur
District had challenged the constitutional validity of clause 3(1-
a) of the Order issued by the Central Government under E
Section 5 read with Section 3 of the Essential Commodities
Act, 1955 placing complete ban on the transport, movement or
otherwise carrying of paddy outside the districts. The High
Court rejected their challenge and dismissed the writ petitions.
Before this Court, it was argued that the delegation of power F
under Section 5 of the Act must necessarily be given a
restricted interpretation. While rejecting the argument, this
Court referred to the judgment in Sibnath Banerji's case,
Santosh Kumar Jain v. State AIR 1951 SC 201 and observed:
"Learned Counsel for the appellant however strenuously G
contends that the delegation of powers by the Central
Government under Section § of the Act must necessarily
be in relation to 'such matters' and subject to 'such
conditions' as may be specified in the notification. The
whole attempt on the part of the learned Counsel is to H
1092 SUPREME COURT REPORTS [2013) 12 S.C.R.
A confine the scope and ambit of the impugned order to CL
(d) of Sub-section (2) of Section ~of the Act which uses
the word 'regulating' and take it out of-the Pllrview of Sub-
section (1) of Section ~which uses the words 'regulating
or prohibiting'. That is not proper way of construction of
B Sub-section (1) and (2) of Section ~ of the Act in their
normal setting. The restricted construction of Section ~
contended for by learned Counsel for the appellant would
render the scheme of the Act wholly unworkable as already
indicated, the source of power to make an order of this
c description is Sub-section (1) of Section ~of the Act and
sub's. (2) merely provides illustration for the general
powers conferred by Sub-section (1 ). Sub-section (2) of
Section ~ of the Act commences with the words 'Without
prejudice to the generality of the powers conferred by Sub-
section (1 )'. It is manifest that Sub-section (2) of Section
D
~ of the Act confers no fresh powers but is merely
illustrative of the general powers conferred by Sub-section
(1) of Section~ without exhausting the subjects in relation
to which such powers can be exercised."
E 41. The question was again considered in D.K. Trivedi
and Sons v. State of Gujarat 1986 (Supp) SCC 20. This Court
was called upon to examine the challenge to the constitutionality
of Section 15 of the Mines and Minerals (Regulation and
Development) Act, 1957, the power of the State Governments
F to make rules under Section 15 to enable them to charge dead
rent and royalty in respect of leases of mines and minerals
granted to them and to enhance the rates of dead rent and
royalty. While repelling the argument that the 1957 Act does not
contain guidelines for exercise of power by the State
G Government under Section 15(1), this Court observed:
"32. There is no substance in the contention that no
guidelines are provided in the 1957 Act for the exercise
of the rule-making power of the State Governments under
Section 15(1 ). As mentioned earlier, Section 15(1) is in
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1093
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.)
pari materia with Section 13(1 ). Section 13, however, A
contains sub-section (2) which sets out the particular
matters with respect to which the Central Government may
make rules "In particular, and without prejudice to the
generality of the foregoing power", that is, the rule-making
power conferred by sub-section (1 ). It is well settled that B
where a statute confers particular powers without prejudice
to the generality of a general power already conferred, the
particular powers are only illustrative of the general power
and do not in any way restrict the general power. Section
2 of the Defence of India Act, 1939, as amended by c
Section 2 of the Defence of India (Amendment) Act, 1940,
conferred upon the Central Government the power to make
such rules as appeared to it "to be necessary or expedient
for securing the defence of British India, the public safety,
the maintenance of public order or the efficient prosecution D
of war, or for maintaining supplies and services essential
to the life of the community". Sub-section (2) of Section 2
conferred upon the Central Government the power to
provide by rules or to empower any authority to make
orders providing for various matters set out in the said sub- E
section. This power was expressed by the opening words
of the said sub-section (2) to be "Without prejudice to the
generality of the powers conferred by sub-section (1)". In
King Emperor v. Sibnath Banerji the Judicial Committee
of the Privy Council held:
F
"In the opinion of Their Lordships, the function of
sub-section (2) is merely an illustrative one; the rule-
making power is conferred by subsection (1), and
'the rules' which are referred to in the opening
sentence of sub-section (2) are the rules which are F
authorized by, and made under, sub-section (1); the
provisions of sub-section (2) are not restrictive of
sub-section (1), as, indeed, is expressly stated by
the words 'without prejudice to the generality of the
powers conferred by sub-section (1)." H
1094 SUPREME COURT REPORTS (2013) 12 S.C.R.
A The above proposition of law has been approved and
accepted by this Court in Om Prakash v. Union of India
(1970) 3 SCC 942 and Shiv Kirpal Singh v. V. V. Giri
(1970) 2 sec 567.
33. A provision similar to sub-section (2) of Section 13,
B
however, does not find place in Section 15. In our opinion,
this makes no difference. What sub-section (2) of Section
13 does is to give illustrations of the matters in respect of
which the Central Government can make rules for
"regulating the grant of prospecting licences and mining
c leases in respect of minerals and for purposes connected
therewith". The opening clause of sub-section (2) of
Section 13, namely, "In particular, and without prejudice to
the generality of the foregoing power", makes it clear that
the topics set out in that sub-section are already included
D in the general power conferred by sub-section (1) but are
being listed to particularize them and to focus attention on
them. The particular matters in respect of which the Central
Government can make rules under sub-section (2) of
Section 13 are, therefore, also matters with respect to
E which under sub-section (1) of Section 15 the State
Governments can make rules for "regulating the grant of
quarry leases, mining leases or other mineral concessions
in respect of minor minerals and for purposes connected
therewith". When Section 14 directs that "The provisions
F of Sections 4 to 13 (inclusive) shall not apply to quarry
leases, mining leases or other mineral concessions in
respect of minor minerals", what is intended is that the
matters contained in those sections, so far as they concern
minor minerals, will not be controlled by the Central
G Government but by the concerned State Government by
exercising its rule-making power as a delegate of the
Central Government. Sections 4 to 12 form a group of
sections under the heading "General restrictions on
undertaking prospecting and mining operations". The
H exclusion of the application of these sections to minor
BHARAT SANCHAR NIGAM LTD v. TELECOM 1095
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
minerals means that these restrictions will not apply to A
minor minerals but that it is left to the State Governments
to prescribe such restrictions as they think fit by rules made
under Section 15(1 ). The reason for treating minor minerals
differently from minerals other than minor minerals is
obvious. As seen from the definition of minor minerals B
given in clause (e) of Section 3, they are minerals which
are mostly used in local areas and for local purposes while
minerals other than minor minerals are those which are
necessary for industrial development on a national scale
and for the economy of the country. That is why matters c
relating to minor minerals have been left by Parliament to
the State Governments while reserving matters relating to
minerals other than minor minerals to the Central
Government. Sections 13, 14 and 15 fall in the group of
sections which is headed "Rules for regulating the grant
0
of prospecting licences and mining leases". These three
sections have to be read together. In providing that Section
13 will not apply to quarry leases, mining leases or other
mineral concessions in respect of minor minerals what was
done was to take away from the Central Government the
power to make rules in respect of minor minerals and to E
confer that power by Section 15(1) upon the State
Governments. The ambit of the power under Section 13
and under Section 15 is, however, the same, the only
difference being that in one case it is the Central
Government which exercises the power in respect of F
minerals other than minor minerals while in the other case
it is the State Governments which do so in respect of minor
minerals. Sub-section (2) of Section 13 which is illustrative
of the general power conferred by Section 13(1) contains
sufficient guidelines for the State Governments to follow in G
framing the rules under Section 15(1). and in the same
way. the State Governments have before them the
restrictions and other matters provided for in Sections 4 ..
to 12 while framing their own rules under Section 15(1)."
(emphasis supplied) H
1096 SUPREME COURT REPORTS [2013] 12 S.C.R.
A 42. The same proposition has been reiterated in Academy
of Nutrition Improvement v. Union of India (2011) 8 SCC 274
[Para66] . The observations contained in the last portion of that
paragraph suggesting that the power conferred upon the rule
making authority does not entitle it to make rules beyond the
B scope of the Act has no bearing on these cases because it has
not been argued before us that the regulations framed under
Section 36 are ultra vires the provisions of the Act.
43. Here it will be apposite to mention that Section
c 11 (1)(b)(iv) specifically postulates making of regulations for
discharging the functions specified in those clauses. Section
11 (2), which contains non-obstante clause vis-a-vis the Indian
Telegraph Act, 1885, lays down that the Authority may, from time
to time, by order notify the rates at which the telecommunication
o services within or outside India shall be provided under the Act
subject to the limitation specified in Section 11 (3). Under
Section 12(1), the Authority is empowered to issue order and
call upon any service provider to furnish such information or
explanation relating to its affair or appoint one or more persons
E to make an inquiry in relation to the affairs of any service
provider and direct inspection of the books of account or other
documents of any service provider. Sections 12(4) and 13 of
the Act on which reliance has been placed by the learned
counsel for the respondents in support of their argument that
F the Authority cannot frame regulations on the subjects
mentioned in these two sections are only enabling provisions.
This is evinced from the expressions "shall have the power"
used in Section 12(4) and "The Authority may• used in Section
13. In terms of Section 12(4), the Authority can issue such
G directions to service providers, as it may consider necessary,
for proper functioning by service providers. Section 13 lays
down that the Authority may for discharge of its functions under
Section 11 (1 ), issue such directions to the service providers,
as it may consider necessary. The scope of this provision is
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1097
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
limited by the proviso, which lays down that no direction under A
Section 12(4) or Section 13 shall be issued except on matters
specified in Section 11 (1)(b). It is thus clear that in discharge
of its functions, the Authority can issue directions to the service
providers. The Act speaks of many players like the licensors
and users, who do not come within the ambit of the term B
"service provider". If the Authority has to discharge its functions
.qua the licensors or users, then it will have to use powers under
provisions other than Sections 12(4) and 13. Therefore, in
exercise of power under Section 36(1 ), the Authority can make
regulations which may empower it to issue directions of c
general character applicable to service providers and others
and it cannot be said that by making regulations under Section
36(1) the Authority has encroached upon the field occupied by
Sections 12(4) and 13 of the Act.
44. Before parting With this aspect of the matter, we may D
notice Sections 33 and 37. A reading of the plain language of
Section 33 makes it clear that the Authority can, by general or
special order, delegate to any member or officer of the Authority
or any other person such of its powers and functions under the
Act except the power to settle disputes under Chapter IV or E
make regulations under Section 36. This means that the power
to make regulations under Section 36 is non-delegable. The
reason for excluding Section 36 from the purview of Section
33 is simple. The power under Section 36 is legislative as
opposed to administrative. By virtue of Section 37, the F
regulations made under the Act are placed on par with the rules
which can be framed by the Central Government under Section
35 and being in the nature of subordinate legislations, the rules
and regulations have to be laid before both the Houses of
Parliament which can annul or modify the same. Thus, the G
regulations framed by the Authority can be made ineffective or
modified by Parliament and by no other body.
45. In view of the above discussion and the propositions
laid down in the judgments referred to in the preceding
H
1098 SUPREME COURT REPORTS [2013] 12 S.C.R.
A paragraphs, we hold that the power vested in the Authority under
Section 36(1) to make regulations is wide and pervasive. The
exercise of this power is only subject to the provisions of the
Act and the Rules framed under Section 35 thereof. There is
no other limitation on the exercise of power by the Authority
B under Section 36(1 ). It is not controlled or limited by Section
36(2) or Sections 11, 12 and 13.
46. The second and more important facet of the question
framed by the Court is whether TDSAT has the jurisdiction to
C entertain challenge to the regulations framed by the Authority.
47. The learned Solicitor General referred to Articles 323A
and 323B of the Constitution, Section 14 of the Administrative
Tribunals Act, 1985, the judgment of the larger Bench in L.
Chandra Kumar v. Union of India (1997) 3 SCC 261 and
D argued that whenever Parliament wishes to confer power of
judicial review on an adjudicatory body other than the regular
Courts, it has enacted a provision like Section 14 of the 1985
Act. He submitted that the language of Section 14 of the Act,
which was enacted after 12 years of the enactment of the 1985
E Act and was amended in 2000 does not empower TDSAT to
undertake judicial review of subordinate legislation. Learned
Solicitor General further argued that the words 'direction',
'decision' or 'order' used in Section 14(b) should not be given
over-stretched meaning to empower TDSAT to entertain
F challenge to the regulations made under Section 36 of the Act,
which are in the nature of subordinate legislation. He
emphasized that if these words are interpreted to include the
regulations made under Section 36, the same interpretation
would hold good qua the rules framed under Section 35
G because they are also in the nature of subordinate legislation.
Learned Solicitor General submitted that it would be an
extremely anomalous position if the rules framed under Section
35 and the regulations framed under Section 36 are challenged
before TDSAT and validity thereof is examined by a Bench
comprising non-judicial members. The learned Solicitor
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1099
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
General relied upon the judgment of the Constitution Bench in A
PTC India Ltd. v. Central Electricity Regulatory Commission
{2010) 4 sec 603 and argued that even though in paragraph
94 of the judgment the Bench had observed that summary of
findings and answer to the reference shall not be construed as
a general principle of law to be applied to Appellate Tribunals B
vis-a-vis Regulatory Commissions constituted under other
enactments including the Act, the ratio of the judgment is clearly
attracted in the present case. He submitted that Section 79 of
the Electricity Act, 2003 {for short, 'the 2003 Act') does not
contain Clauses like 11 (1 ){b){vii) and (viii) of the Act and c
provision like Section 36(2) of the Act is not contained in the
2003 Act and further that Section 111 of the 2003 Act contains
only the word 'order' as against the words 'direction', 'decision'
or 'orders' used in Section 14 but that these differences are
insignificant and there is no justification to ignore the ratio of D
the judgment of the Constitution Bench. Shri Nariman submitted
that distinction sought to be made by the other side with
reference to the language of Sections 79, 111 and 178{2){ze)
of the Electricity Act, 2003 is illusory because after noticing
Section 121 which uses the words 'orders', 'instructions' or
'directions', the Constitution Bench has unequivocally held that E
the said section does not confer power of judicial review on the
Appellate Tribunal.
48. SIShri A.S. Chandhiok, C.S. Vaidyanathan, Dr. A.M.
Singhvi, Ramji Shrinivashan and Mukul Rohatgi, learned senior F
counsel relied upon the judgment of the larger Bench in L.
Chandra Kumar vs. Union of India {supra) and argued that
every Tribunal constituted under an Act of Parliament or State
Legislature is empowered to exercise power of judicial review
qua the rules and regulations. They also relied upon the G
judgments of this Court in Cellular Operators Assn. of India v.
Union of India (2003) 3 SCC 186, Hotel & Restaurant
Association v. Star India (P) Ltd. {2006) 13 SCC 753, Union
of India v. TA TA Teleservices (Maharashtra) Ltd. {2007) 7
SCC 517, Union of India v. Association of Unified Telecom H
1100 SUPREME COURT REPORTS [2013] 12 S.C.R.
A Service Providers of India (2011) 10 SCC 543 and argued
that the validity of the regulations framed under Section 36 can
be examined by TDSAT and in appropriate cases the same
can be struck down. They further argued that the regulations
framed under Section 36 are essentially in the nature of a
B decision taken by the Authority and the same can always be
subjected to challenge under Section 14(b). Learned senior
counsel also referred to order dated 28.3.2006 passed by a
three-Judge Bench in Civil Appeal No.6743/2003 - Telecom
Regulatory Authority of India v. BPL Mobile Cellular Ltd. and
C argued that having taken the stand before this Court that a
'direction' includes 'regulation', the Authority is estopped from
adopting a different posture before this Court on the issue of
maintainability of appeal under Section 14(b) involving
challenge to the regulations. Dr. Singhvi and Shri Rohatgi
argued that one of the objectives of the amendments made in
0
2000 was to create a specialised body for expeditious
adjudication of disputes and appeals and that objective will be
totally defeated if the regulations framed under Section 36 are
excluded from the ambit of Section 14(b). They also relied upon
the judgment of this Court in Madras Bar Association v. Union
E of India (2010) 11 SCC 1 and argued that once Parliament has
conferred power of judicial review upon TDSAT, there is no
valid ground to whittle down the scope thereof by giving a
restrictive interpretation to Section 14(b) of the Act.
F 49. Before dealing with the respective arguments, we may
revert back to Section 14 (unamended and amended). Under
the unamended Section 14(1), the Authority could decide
disputes among service providers and between service
providers and a group of consumers. In terms of Section 14(2)
G (unamended), the bench constituted by the Chairperson of the
Authority can exercise powers and authority which were
exercisable earlier by the Civil Court on technical compatibility
and inter-connections between service providers, revenue
sharing arrangements between different service providers,
H quality of telecommunication services and interest of
BHARAT SANCHAR NIGAM LTD v. TELECOM 1101
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
consumers. However, the disputes specified in clauses (a), (b) A
and (c) of Section 14(2) could not be decided by the Bench
constituted by the Chairperson.
50. Since the mechanism provided for settlement of
disputes under Section 14 of the unamended Act was not B
satisfactory, Parliament substituted that section and facilitated
establishment of an independent adjudicatory body known as
TDSAT. Clause (a) of amended Section 14 confers jurisdiction
upon TDSAT to adjudicate any dispute between a licensor and
licensee, between two or more service providers and between C
a service provider and a group of consumers. Three exceptions
to the adjudicatory power of TDSAT relates to the cases which
are subject to the jurisdiction of Monopolies and Restrictive
Trade Practices Commission, the complaint of an individual
consumer which could be maintained under the consumer
forums established under the Consumer Protection Act, 1986 D
and dispute between Telegraph Authority and any other person
referred to in Section 7B(1) of the Indian Telegraph Act, 1885.
In terms of clause (b) of Section 14 (amended), TDSAT is
empowered to hear and dispose of appeal against any
direction, decision or order of the Authority. Section 14A(1) E
provides for making of an application to TDSAT for
adjudication of any dispute referred to in Section 14(a). Section
14A(2) and (3) provides for filing an appeal against any
direction, decision or order made by the Authority and also
prescribes the period of limitation. Sub-sections (4) to (7) of F
Section 14 are, by and large, procedural. Section 14B relates
to composition of Appellate Tribunal. Section 14C prescribes
qualifications for Chairperson and Members. Section 140
speaks of tenure of the Chairperson and every other Member
of TDSAT. Section 14E speaks of terms and conditions of G
service. Section 14F provides for filling up the vacancies.
Section 14G deals with removal and resignation of
Chairperson or any Member of TDSAT. Section 14H relates
to staff of TDSAT. Section 141 empowers the Chairperson to
make provisions of distribution of business of TDSAT amongst H
1102 SUPREME COURT REPORTS [2013] 12 S.C.R.
A different Benches and their roster. Section 14J empowers the
Chairperson to transfer cases from one Bench to the other.
Section 14K lays down that decision of any application or
appeal should be by majority. Section 14L treats the
Chairperson and Members etc. of TDSAT to be public servants.
B Sections 14M and 14N provide for transfer of pending cases
and appeals.
51. The primary objective of the 2000 amendment was to
separate adjudicatory functions of the Authority from its
C administrative and legislative functions and ward off the criticism
that the one who is empowered to make regulations and issue
directions or pass orders is clothed with the power to decide
legality thereof. The word 'direction' used in Section 14(b) is
referable to Sections 12(4) and 13. The word 'order' is
referable to Section 11(2) and 12(1). The word 'decision' has
D been used in Section 14-A(2) and (7). This is because the
proviso to Section 14-M postulates limited adjudicatory function
of the Authority in respect of the disputes being adjudicated
under Chapter IV before the 2000 amendment. This proviso
was incorporated in Section 14-M to avoid a hiatus between
E the coming into force of the 2000 amendment and the
establishment of TDSAT.
52. None of the words used in Section 14(b) have anything
to do with adjudication of disputes. Before the 2000
F Amendment, the applications were required to be filed under
Section 15 which also contained detailed procedure for
deciding the same. While sub-Section (2) of Section 15 used
· the word 'orders', sub-Sections (3) and (4) thereof used the
word 'decision'. In terms of sub-Section (5), the orders and
G directions of the Authority were treated as binding on the
service providers, Government and all other persons
concerned. Section 18 provided for an appeal against any
decision or order of the Authority. Such an appeal could be filed
before the High Court. The amendment made in 2000 is
intended to vest the original jurisdiction of the Authority in
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1103
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
TDSAT and the same is achieved by Section 14(a). Th~ A
appellate jurisdiction exercisable by the High Court is also
vested in TDSAT by virtue of Section 14(b) but this does not
include decision made by the Authority. Section 14-N provides
for transfer to all appeals pending before the High Court to
TDSAT and in terms of Clause (b) of sub-Section (2), TDSAT B
was required to proceed to deal with the appeal from the stage
which was reached before such transfer or from any earlier
stage or de novo as considered appropriate by it. Since High
Court while hearing appeal did not have the power of judicial
review of subordinate legislation, the transferee adjudicatory c
forum, i.e., TDSAT cannot exercise that power under Section
14(b).
53. In Cellular Operators Assn. of India v. Union of India
(supra), Pattanaik, C.J., who authored main judgment of the
three Judge Bench, referred to Section 14 and observed: D
"Suffice it to say, Chapter IV containing Section 14 was
inserted by an amendment of the year 2002 and the verv
Statement of Objects and Reasons would indicate that to
increase the investors' confidence and to create a level E
playing field between the public and the private operators.
suitable amendment in the Telecom Regulatory Authority
of India Act. 1997 was brought about and under the
amendment. a tribunal was constituted called the Telecom
Disputes Settlement and Appellate Tribunal for F
adjudicating the disputes between a licensor and a
licensee. between two or more service providers. between
a service provider and a group of consumers and also to
hear and dispose of appeal against any direction. decision
or order of the Authority. The aforesaid provision was G
absolutely essential as the organizations of the licensor.
namely. MTNL and BSNL were also service providers.
That being the object for which an independent tribunal was
constituted. the power of that Tribunal has to be adjudged
from the language conferring that power and it would not H
1104 SUPREME COURT REPORTS (2013) 12 S.C.R.
A be appropriate to restrict the same on the ground that the
decision which is the subject-matter of challenge before
the Tribunal was that of an expert body. It is no doubt true,
to which we will advert later, that the composition of the
Telecom Regulatory Authority of India as well as the
B constitution of GOT-IT in April 2001 consists of a large
number of eminent impartial experts and it is on their
advice, the Prime Minister finally took the decision, but that
would not in any way restrict the power of the Appellate
Tribunal under Section 14, even though in the matter of
c appreciation the Tribunal would give due weight to such
expert advice and recommendations. Having regard to the
very purpose and object for which the Appellate Tribunal
was constituted and having examined the different
provisions contained in Chapter IV, more particularly, the
provision dealing with ousting the jurisdiction of the civil
D
court in relation to any matter which the Appellate Tribunal
is empowered by or under the Act, as contained in Section
15, we have no hesitation in coming to the conclusion that
the power of the Appellate Tribunal is quite wide, as has
been indicated in the statute itself and the decisions of this
E Court dealing with the power of a court, exercising
appellate power or original power, will have no application
for limiting the jurisdiction of the Appellate Tribunal under
the Act. Since the Tribunal is the original authority to
adjudicate any dispute between a licensor and a licensee
F or between two or more service providers or between a
service provider and a group of consumers and since the
Tribunal has to hear and dispose of appeals against the
directions. decisions or order of TRAI, it is difficult for us
to import the self-contained restrictions and limitations of
G a court under the judge-made law to which reference has
already been made and reliance was placed by the
learned Attorney-General."
(emphasis supplied)
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1105
REGULATORY AUTH. OF INDl.ti, [G.S. SINGHVI, J.]
54. In Union of India v. TATA Teleservices (Maharashtra) A
Ltd. (supra), the two Judge Bench of this Court referred to the
scheme of the Act and observed:
'The conspectus of the provisions of the Act clearly
indicates that disputes between the licensee or licensor, 8
between two or more service providers which takes in the
Government and includes a licensee and between a
service provider and a group of consumers are within the
purview of TDSAT. A plain reading of the relevant
provisions of the Act in the light of the Preamble to the Act C
and the Objects and Reasons for enacting the Act,
indicates that disputes between the parties concerned,
which would involve significant technical aspects, are to be
determined by a specialised tribunal constituted for that
purpose. There is also an ouster of jurisdiction of the civil
court to entertain any suit or proceeding in respect of any D
matter which TDSAT is empowered by or under the Act
to determine. The civil court also has no jurisdiction to grant
an injunction in respect of any action taken or to be taken
in pursuance of any power conferred by or under the Act.
The constitution of TDSAT itself indicates that it is chaired E
by a sitting or retired Judge of the Supreme Court or sitting
or a retired Chief Justice of the High Court, one of the
highest judicial officers in the hierarchy and the members
thereof have to be of the cadre of Secretaries to the
Government, obviously well experienced in administration F
and administrative matters.
The Act is seen to be a self-contained code intended to
deal with all disputes arising out of telecommunication
services provided in this country in the light of the National G
Telecom Policy, 1994. This is emphasised by the Objects
and Reasons also.
Normally, when a specialised tribunal is constituted for
dealing with disputes coming under it of a particular nature
taking in serious technical aspects, the attempt must be H
1106 SUPREME COURT REPORTS [2013] 12 S.C.R.
A to construe the jurisdiction conferred on it in a manner as
not to frustrate the object sought to be achieved by the Act.
In this context, the ousting of the jurisdiction of the civil court
contained in Section 15 and Section 27 of the Act has also
to be kept in mind. The subject to be dealt with under the
B Act has considerable technical overtones which normally
a civil court, at least as of now, is ill equipped to handle
and this aspect cannot be ignored while defining the
jurisdiction of TDSAT."
55. In the aforementioned judgments, this Court has laid
C emphasis on the scope of the jurisdiction of TDSAT but has
not dealt with the question whether the words 'direction',
'decision' or 'order' include 'regulations' framed under Section
36 of the Act and the same could be subjected to appellate
jurisdiction of TDSAT. Therefore, those ;udgments cannot be
D relied upon for holding that in exercise of power under Section
14(b) of the Act TDSAT can hear an appeal against regulations
framed under Section 36.
56. We may now deal with the judgment of three Judge
E Bench in Civil Appeal No.6743/2003 - Telecom Regulatory
Authority of India v. BPL Mobile Cellular Ltd. is clearly
distinguishable. The facts of that case were that in May, 2001
respondent No.1 offered a scheme as a promotional plan to
its customers. Several thousand subscribers accepted the offer.
F In October, 2001 the scheme was dropped. A public interest
litigation was filed by one subscriber challenging the unilateral
dropping of the scheme by respondent No.1. The High Court
passed an order and directed the appellant to submit a report
in that connection. No report having been submitted, by a
G subsequent order dated 24.9.2002, the High Court directed the
appellant to take steps after hearing the parties and submit a
report of compliance within a period of three months from the
date of the order. Pursuant to this directive the appellant
passed an order on 23.12.2002 holding, inter alia, that
H respondent No.1 had violated the provisions of the
BHARAT SANCHAR NIGAM LTD v. TELECOM 1107
REGULATORY AUTH. OF INDIA [G.S. SINGHVI; J.]
Telecommunication Tariff Order, 1999 insofar as it had failed A
to inform the appellant either as to the introduction of the
scheme or subsequent withdrawal hereof. It was found that the
action of respondent No. I had adversely affected the interest
of the subscribers. Finally the appellant opined that the violation
was of serious nature and to be dealt with in accordance with B
Section 29 read with Section 34 of the Act. Thereafter, a
complaint was lodged before the jurisdictional Magistrate.
Respondent No.1 filed an appeal against order dated
23.12.2002. TDSAT allowed the appeal and held that Section
29 could not be invoked for any violation of an order issued by c
the appellant. This Court referred to Sections 29 and 34 and
formulated the following question:
"Whether the word 'directions' would include the
Telecommunication Tariff Order, 1999 (hereinafter referred
to as the 'Order') so that any violation thereof would be D
punishable under Section 29 read with Section 34."
The Court then referred to Sections 11(1)(c), 11(2), 12(4), 13
and observed:
E
"The order which has been passed in 1999 has in fact
sought to and ensures compliance of the terms and
conditions of the licence granted by the Government of
India to the respondent.
It appears to us on a reading of all these provisions that F
the word 'directions' had been used in a wide sense to
cover orders/regulations which in effect direct an action to
be taken we were to limit Section 29 only to directions
which were not directory orders or/directory regulations this
would mean that violation of such orders/regulations would . G
not carry any penal consequence whatsoever.
Consequently, the entire scheme of the Act would become
unworkable. Besides Section 11 (1}(b) in respect of which
directions may be issued has itself also been widely
framed. Indeed the order in question pertains to the H
1108 SUPREME COURT REPORTS [2013] 12 S.C.R.
A provisions of Section 11 (1)(b)(i) as we have already stated.
It may be that Section 29 creates an offence and therefore,
must be strictly construed. However, that principle will not
militate with the principle that the interpretation of a word
must be made contextually. We have to ascertain the
B meaning of the word 'directions' in Section 29. The word
'directions' can take within its fold directory orders and
regulations in the nature of directions as a matter of
semantics. Besides in the context of the Act there is no
reason not to include the orders and regulations containing
c directions within the word 'directions.' This would also be
a logical corollary as such regulations and orders have
appended to them a more serious mandate."
57. From the above extracted portion of the order it is
evident that the Bench, which decided the matter, felt that the
D view taken by TDSAT would encourage rampant violation of the
orders without any penal consequence and the entire scheme
of the Act would become unworkable. The word 'directions'
used in Section 29 of the Act was interpreted to include orders
and regulations in the context of the factual matrix of that case
and the apprehension of the Court that Section 29 would
otherwise become unworkable, but the same cannot be read
as laying down a proposition of law that th1~ words 'direction',
'decision' or 'order' used in Section 14(b) would include
regulation framed under Section 36, which are in the nature of
F subordinate legislation.
58. In PTC India Ltd. v. Central Electricity Regulatory
.>:.;,.,.Commission (surpa), the Constitution Bench framed the
·:?)<
· following questions:
G "(i) Whether the Appellate Tribunal constituted under the
Electricity Act, 2003 (the 2003 Act) has jurisdiction under
Section 111 to examine the validity of the Central
Electricity .Regulatory Commission (Fixation of Trading
Margin) Regulations, 2006 framed in exercise of power
H conferred under Section 178 of the 2003 Act?
BHARAT SANCHAR NIGAM LTD v. TELECOM 1109
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
(ii) Whether Parliament has conferred power of judicial A
review on the Appellate Tribunal for Electricity under
Section 121 of the 2003 Act?
(iii) Whether capping of trading margins could be done by
CERC (the Central Commission) by making a regulation B
in that regard under Section 178 of the 2003 Act?"
59. The Constitution Bench extensively referred to the
provisions of the Electricity Act, 2003 including Sections 73,
75, 79, 86, 111, 177, 178, 179, 181and182, and observed:
c
"47. On the above submissions, one of the questions
which arises for determination is-whether trading margin
fixation (including capping) under the 2003 Act can only
be done by an order under Section 79(1)0) and not by
regulations under Section 178? According to the D
appellant(s) it can only be done by an order under Section
79(1 )0), particularly when under Section 178(2) power to
make regulations is co-relatable to the functions ascribed
to each authority under the said 2003 Act.
48. In every case one needs to examine the statutory E
context to determine whether a court or a tribunal hearing
a case has jurisdiction to rule on a defence based upon
arguments of invalidity of subordinate legislation or
administrative act under it. There are situations in which
Parliament may legislate to preclude such challenges in F
the interest of promoting certainty about the legitimacy of ""
administrative acts on which the public may have to rely.
49. On the above analysis of various sections of the 2003
Act, we find that the decision-making and regulation- G
making functions are both assigned to CERC. Law comes
into existence not only through legislation but also by
regulation and litigation. Laws from all three sources are
binding. According to Professor Wade, "between
legislative and administrative functions we have regulatory H
'1110 SUPREME COURT REPORTS [2013] 12 S.C.R.
A functions". A statutory instrument, such as a rule or
regulation, emanates from the exercise of delegated
legislative power which is a part of administrative process
resembling enactment of law by the legislature whereas a
quasi-judicial order comes from adjudication which is also
B a part of administrative process resembling a judicial
decision by a court of law.
50. Applying the above test, price fixation exercise is really
legislative in character, unless by the terms of a particular
statute it is made quasi-judicial as in the case of tariff
c fixation under Section 62 made appealable under Section
111 of the 2003 Act, though Section 61 is an enabling
provision for the framing of regulations by CERC. If one
takes "tariff' as a subject-matter, one finds that under Part
VII of the 2003 Act actual determinationlfixation of tariff is
D done by the appropriate Commission under Section 62
whereas Section 61 is the enabling provision for framing
of regulations containing generic propositions in
accordance with which the appropriate Commission has
to fix the tariff. This basic scheme equally applies to the
E subject-matter "trading margin" in a different statutory
context as will be demonstrated by discussion
herein below."
The Bench then referred to the judgments in Narinder
F Chand Hem Raj v. Lt. Governor, H.P. (1971) 2 SCC 747 and
Indian Express Newspapers (Bombay) (P) Ltd. v. Union of
India (1985) 1 SCC 641 and held:
"53. Applying the abovementioried tests to the scheme of
the 2003 Act, we find that under the Act, the Central
G Commission is a decision-making as well as regulation-
making authority, simultaneously. Section 79 delineates the
functions of the Central Commission broadly into two
categories-mandatory functions and advisory functions.
Tariff regulation, licensing (includirg inter-State trading
H licensing), adjudication upon disputes involving generating
BHARAT SANCHAR NIGAM LTD v. TELECOM 1111
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.)
companies or transmission licensees fall under the head A
"mandatory functions" whereas advising the Central
Government on formulation of National Electricity Policy
and tariff policy would fall under the head "advisory
functions". In this sense, the Central Commission is the
decisioncmaking authority. Such decision-making under B
Section 79(1) is not dependent upon making of regulations
under Section 178 by the Central Cc>mmission. Therefore,
functions of the Central Commission enumerated in
Section 79 are separate and distinct from functions of the
Central Commission under Section 178. The former are c
administrative/adjudicatory functions whereas the latter are
legislative.
54. As stated above, the 2003 Act has been enacted in
furtherance of the policy envisaged under the Electricity
Regulatory Commissions Act, 1998 as it mandates D
establishment of an independent and transparent
Regulatory Commission entrusted with wide-ranging
responsibilities and objectives inter alia including
protection of the consumers of electricity. Accordingly, the
Central Commission is set up under Section 76(1) to E
exercise the powers conferred on, and in discharge of the
functions assigned to, it under the Act. On reading Sections
76(1) and 79(1) one finds that the Central Commission is
empowered to take measures/steps in discharge of the
functions enumerated in Section 79(1) like to regulate the F
tariff of generating companies, to regulate the inter-State
transmission of electricity, to determine tariff for inter-State
transmission of electricity, to issue licences, to adjudicate
upon disputes, to levy fees, to specify the Grid Code, to
fix the trading margin in inter-State trading of electricity, if G
considered necessary, etc. These measures, which the
Central Commission is empowered to take, have got to
be in conformity with the regulations under Section 178,
wherever such regulations are applicable. Measures under
Section 79(1 ), therefore, have got to be in conformity with H
1112 SUPREME COU8T REPORTS [2013] 12 S.C.R..
A the regulations under Section 178.
55. To regulate is an exercise which is different from
making of the regulations. However, making of a regulation
under Section 178 is not a· precondition to the Central
Commission taking any steps/measures under Section
B
79(1). As stated, if there is a regulation, then the measure
under Section 79(1) has to be in conformity with such
regulation under Section 178. This principle flows from
various judgments of this Court which we have discussed
hereinafter. For example, under Section 79(1 )(g) the
c Central Commission is required to levy fees for the
purpose of the 2003 Act. An order imposing regulatory
fees could be passed even in the absence of a regulation
under Section 178. If the levy is unreai;onable, it could be
the subject-matter of challenge before the appellate
D authority under Section 111 as the levy is imposed by an ,
order/decision-making process. Making of a regulation
under Section 178 is not a precondition to passing of an
order levying a regulatory fee under Section 79(1 )(g).
However, ifthere is a regulation under Section 178 in that
E regard then the order levying fees under Section 79(1 )(g)
has to be in consonance with such regulation.•
The Constitution Bench then considered the question
whether Section 121 of the Electricity Act, 2003 can be read
F as conferring power of judicial review upon the Appellate
Tribunal. The Bench referred to the judgment in Raman and
Raman Ltd. v. State of Madras AIR 1959 SC 694 and
observed:
"83. Applying the tests laid down in the above judgment
G to the present case, we are of the view that, the words
"orders", "instructions" or "directions" in Section 121 do not
confer power of judicial review in the Tribunal. It is not
possible to lay down any exhaustive list of cases in which
there is failure in performance of statutory functions by the
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1113
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
appropriate Commission. However, by way of illustrations, A
we may state that, under Section 79(1)(h) CERC is
required to specify the Grid Code having regard to the Grid
Standards. Section 79 comes in Part X. Section 79 deals
with functions of CERC. The word "grid" is defined in
Section 2(32) to mean high voltage backbone system of B
interconnected transmission lines, sub-stations and
generating plants. Basically, a grid is a network. Section
2(33) defines "Grid Code" to mean a code specified by
CERC under Section 79(1)(h). Section 2(34) defines "Grid
Standards" to mean standards specified under Section c
73(d) by the Authority.
84. Grid Code is a set of rules which governs the
maintenance of the network. This maintenance is vital. In
summer months grids tend to trip. In the absence of the
making of the Grid Code in accordance with the Grid D
Standards, it is open to the Tribunal to direct CERC to
perform its statutory functions of specifying the Grid Code
having regard to the Grid Standards prescr.ibed by the
Authority under Section 73. One can multiply these
illustrations which exercise we do not wish to undertake. E
Suffice it to state that, iri the light of our analysis of the 2003
Act, hereinabove, the words "orders, instructions or
directions" in Section 121 of the 2003 Act cannot confer
power of judicial review under Section 121 to the Tribunal,
which, therefore, cannot go into the validity of the F
impugned 2006 Regulations, as rightly held in the
impugned judgment."
60. The summary of the findings of the Constitution Bench
are contained in paragraph 92, which is reproduced b~low: G
"92. (i) In the hierarchy of regulatory powers and functions
under the 2003 Act, Section 178, which deals with making
of regulations by the Central Commission, under the
authority of subordinate legislation, is wider than Section
79(1) of the 2003 Act, which enumerates the regulatory H
1114 SUPREME COURT REPORTS [2013] 12 S.C.R.
A functions of the Central Commission, in specified areas,
to be discharged by orders (decisions).
(ii) A regulation under Section 178, as a part of regulatory
framework, intervenes and even overrides the existing
contracts between the regulated entities inasmuch as it
B
casts a statutory obligation on the regulated entities to
align their existing and future contracts with the said
regulation.
(iii) A regulation under Section 178 is made under the
c authority of delegated legislation and consequently its
validity can be tested only in judicial review proceedings
before the courts and not by way of appeal before the
Appellate Tribunal for Electricity under Section 111 of the
said Act.
D
(iv) Section 121 of the 2003 Act does not confer power of
judicial review on the Appellate Tribunal. The words
"orders", "instructions" or "directions" in Section 121 ~o not
confer power of judicial review in the Appellate Tribunal for
Electricity. In this judgment, we do not wish to analyse the
E
English authorities as we find from those authorities that
in certain cases in England the power of judicial review is
expressly conferred on the tribunals constituted under the
Act. In the present 2003 Act, the power of judicial review
of the validity of the regulations made Jnder Section 178
F is not conferred on the Appellate Tribunal for Electricity.
(v) If a dispute arises in adjudication on interpretation of a
regulation made under Section 178, an appeal would
certainly lie before the Appellate Tribunal under Section
G 111, however, no appeal to the Appellate Tribunal shall lie
on the validity of a regulation made under Section 178.
(vi) Applying the principle of "generality versus
enumeration", it would be open to the Central Commission
to make a regulation on any residuary item under Section
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1115
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
178(1) read with Section 178(2)(ze). Accordingly, we hold A
that CERC was empowered to cap the trading margin
under the authority of delegated legislation under Section
178 vide the impugned Notification dated 23-1-2006.
(vii) Section 121, as amended by the Electricity B
(Amendment) Act 57 of 2003, came into force with effect
from 27-1-2004. Consequently, there is no merit in the
contention advanced that the said section has not yet been
brought into force."
61. In our view, even though in paragraph 94 of the C
judgment the Constitution Bench clarified that the judgment will
not govern the cases under the Act, the ratio of that judgment
is clearly attracted in these cases.
62. The judgments of the larger Bench in L. Chandra D
Kumar v. Union of India (supra) and Union of India v. Madras
Bar Association (2010) 11 SCC 1 are clearly distinguishable.
In L. Chandra Kumar's case, this Court considered the scope
of Section 14 of the 1985 Act, which reads as under:
"14. Jurisdiction, powers and authority of the Central E
Administrative Tribunal.- ill Save as otherwise expressly
provided in this Act, the Central Administrative Tribunal
shall exercise, on and from the appointed da1L_aU the- -
jurisdiction, powers aodauthorlty exercisable immediately
beforeitral cfay by all courts except the Supreme Court in F
relation to-
(a) recruitment, and matters concerning recruitment, to any
All-India Service or to any civil service of the Union or a
civil post under the Union or to a post connected with G
defence or in the defence servi.ces, being, in either case,
a post filled by a civilian;
(b) all service matters concerning-
(i) a member of any All-India Servi9e; or H
1116 SUPREME COURT REPORTS [2013] 12 S.C.R.
A (ii) a person not being a member of an All-India Service
or a person referred to in clause (c} appointed to any civil
service of the Union or any civil post under the Union; or
(iii) a civilian not being a member of an All-India Service
or a person referred to in clause (c) appointed to any
B
defence, services or a post connected with defence,
and pertaining to the service of such member, person or
civilian, in connection with the affairs of the Union or of any
State or of any local or other authority within the territory
c of India or under the control of the Government of India or
of any corporation or society owned or controlled by the
Government;
(c} all service matters pertaining to service in connection
D with the affairs of the Union concerning a person appointed
to any service or post referred to in sub-clause (ii) or sub-
clause (iii} of clause (b), being a person whose services
have been placed by a State Government or any local or
other authority or any corporation or society or other body,
at the disposal of the Central Government for such
E
appointment.
Explanation.- For the removal of doubts, it is hereby
declared that references to "Union" in this sub-section shall
be construed as including references also to a Union
F territory.
(2) The Central Government may, by notification, apply with
effect from such date as may be specifi1..>d in the notification
the provisions of sub-section (3) to local or other authorities
G within the territory of India or under the control of the
Government of India and to corporations or societies
owned or controlled by Government, not being a local or
other authority or corporation or society controlled or
owned by a State Government:
H
BHARAT SANCHAR NIGAM LTD v. TELECOM 1117
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
Provided that if the Central Government considers it A
expedient so to do for the purpose of facilitating transition
to the scheme as envisaged by this Act, different dates
may be so specified under this sub- section in respect of
different classes of, or different categories under any class
of, local or other authorities or corporations or societies. B
(3) Save as otherwise expressly provided in this Act, the
Central Administrative Tribunal shall also exercise, on and
from the date•with effect from which the provisions of this
sub- section apply to any local or other authority or C
corporation or society, all the jurisdiction, powers and
authority exercisable immediately before that date by all
courts (except the Supreme Court) in relation to-
(a) recruitment, and matters concerning recruitment, to any
service or post in connection with the affairs of such local D
or other authority or corporation or society; and
(b) all service matters concerning a person other than a
person referred to in clause (a) or clause (b) of sub-
section (1) appointed to any service or post in connection E
with the affairs of such local or other authority or corporation
or society and pertaining to the service of such person in
connection with such affairs."
The larger Bench then dealt with the scope of the power
of judicial review vested in the Supreme Court and the High F
Courts and proceeded to observe:
"Before moving on to other aspects, we may summarise
our conclusions on the jurisdictional powers of these
Tribunals. The Tribunals are competent to hear matters G
where the vires of statutory provisions are questioned.
However, in discharging this duty, they cannot act as
substitutes for the High Courts and the Supreme Court
which have, under our constitutional set-up, been
specifically entrusted with such an obligation. Their H
1118 SUPREME COURT REPORTS (2013) 12 S.C.R.
A function in this respect is only supplementary and all such
decisions of the Tribunals will be subject to scrutiny before
a Division Bench of the respective High Courts. The
Tribunals will consequently also have the power to test the
vires of subordinate legislations and rules. However, this
B power of the Tribunals will be subject to one important
exception. The Tribunals shall not entertain any question
regarding the vires of their parent statutes following the
settled principle that a Tribunal which is a creature of an
Act cannot declare that very Act to be unconstitutional. In
c such cases alone, the High Court concerned may be
approached -Oirectly. All other decisions of these Tribunals,
rendered in cases that they are specifically empowered to
adjudicate upon by virtue of their parent statutes, will also
be subject to scrutiny before a Division Bench of their
respective High Courts. We may add that the Tribunals will,
D
however, continue to act as the only courts of first instance
in respect of the areas of law for which they have been
constituted. By this, we mean that it will not be open for
litigants to directly approach the High Courts even in cases
where they question the vires of statutory legislations
E (except, as mentioned, where the legislation which creates
the particular Tribunal is challenged) by overlooking the
jurisdiction of the Tribunal concerned."
1 63. In Union of India v. Madras Bar Association (supra)
F and State of Gujarat v. Gujarat Revenue Tribunal Bar
Association (2012) 10 SCC 353 : 2012 (10) SCALE 285, this
Court applied the principles laid down in L.. Chandra Kumar's
case and reiterated the importance of Tribunals created for
resolution of disputes but these judgments too have no bearing
G on the decision of the question formulated before us.
64. In the result, the question framed by the Court is
answered in the following terms:
In exercise of the power vested in it under Section 14(b)
H
BHARAT SANCHAR NIGAM LTD v. :TELECOM 1119
REGULATORY AUTH. OF INDIA [G.S. SINGHVI, J.]
of the Act, TDSAT does not have the jurisdiction to A
entertain the challenge to the regulations framed by the
Authority under Secfion 36 of the Act.
65. As a corollary, we hold that the contrary view taken by
TDSAT and the Delhi High Court does not represent correct B
law. At the same time, we make it clear that the aggrieved
person shall be free to challenge the validity of the regulations
· framed under Section 36 of the Act by filing appropriate petition
before the High Court.
66. The cases may now be listed before an appropriate C
Bench for deciding the questions framed vide order dated
6.2.2007 passed in Civil Appeal No.3298/2005 and some of
the connected matters,
R.P. Reference Answered. o
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