Supreme Court of India
BHARAT SANCHAR NIGAM LTD. AND OTHERS ETCversusM/S TATA COMMUNICATIONS LTD. ETC.
- Citation
- 2022 INSC 996
- Decided
- 22 September 2022
- Disposal
- Case Partly allowed
- Bench
- AJAY RASTOGI
Holding
Administrative circulars cannot be applied retrospectively unless expressly authorized by legislation; BSNL may levy a 10% annual notional increase only prospectively from 1 April 2013.
Summary
BSNL issued a circular on 12 June 2012 revising infrastructure charges for active links of licensed telecom operators, stating it would apply retrospectively from 1 April 2009 with a 10% annual increase. The operators had already paid charges upfront under the earlier 2006 circular and challenged the retrospective levy. The Telecom Disputes Settlement and Appellate Tribunal held that the circular should be applied prospectively from 1 April 2013 and that no notional increase could be recovered for the 2009‑2012 period. BSNL appealed, arguing that administrative orders could be given retrospective effect and that it could levy the notional increase. The Supreme Court ruled that administrative/executive circulars cannot have retrospective effect unless expressly authorized by legislation, but affirmed BSNL's authority to fix rates and to levy a 10% annual increase prospectively from 1 April 2013. Consequently, the Tribunal's orders were modified, allowing BSNL to demand notional increases from 2013 onward while rejecting claims for the earlier period.
Issues considered
- Can an administrative/executive circular be given retrospective effect in the absence of legislative authority?
- Is BSNL entitled to recover a notional 10% annual increase in infrastructure charges for the period 1 April 2009 to 31 March 2013?
- Should the circular dated 12 June 2012 be applied prospectively from 1 April 2013 rather than retrospectively from 1 April 2009?
Legislation cited
Subjects
Administrative lawRetrospective effectCircularInfrastructure chargesTelecomNotional increaseIndian Telegraph ActInterconnection agreementsLegislative competence
Judgment
[2022] 18 S.C.R. 143 143
BHARAT SANCHAR NIGAM LTD. AND OTHERS ETC. A
v.
M/S TATA COMMUNICATIONS LTD. ETC.
(Civil Appeal Nos. 1699-1723 of 2015)
SEPTEMBER 22, 2022 B
[AJAY RASTOGI AND B.V. NAGARATHNA, JJ.]
Administrative Law – Administrative/executive orders or
circulars, if can be made applicable with retrospective effect – Held:
Only law could be made retrospectively if it was expressly provided
C
by the Legislature in the Statute – Administrative/executive orders
or circulars in the absence of any legislative competence cannot be
made applicable with retrospective effect – In the present case,
applicability of the circular dated 12th June, 2012 to be effective
retrospectively from 1st April 2009, in revising the infrastructure
charges, is not legally sustainable and to this extent, the view D
expressed by the Telecom Disputes Settlement and Appellate Tribunal
under the impugned judgment is agreed with – However, once the
competence of the appellant in fixing the rates of infrastructure
charges in question stands affirmed and is not a subject matter of
challenge, the appellant is well within its rights to make their charges
E
leviable on notional fixation by increase of charges by a certain
percentage every year in terms of circular dated 12th June, 2012
from each of the service provider-respondents as being notionally
applicable from 1st April, 2013 – It was open for the appellant to
notionally fix the charges to be computed and became payable from
1st April, 2013, based on 10% annual increase every year or by F
any other mechanism which may have a reasonable justification –
Such notionally increased charges can indeed be leviable on the
service providers and to this extent, the order passed by the Tribunal
is not sustainable in law – Order of the Tribunal dated 20th August,
2014 followed by the order dated 14th October, 2014 are modified
G
– Indian Telegraph Act, 1885.
Partly allowing the appeals, the Court
1.1 The present dispute survives regarding payment of
infrastructure charges for the limited period of two years i.e. from
H
143
144 SUPREME COURT REPORTS [2022] 18 S.C.R.
A 1st April, 2013 to 31st March, 2015. That the authority of the
appellant in revising the infrastructure charges for active links
leased to telecom operators is not a subject matter of challenge
and none of the respondents have questioned the authority of
the appellant in revising the infrastructure charges for active links
leased to telecom operators. The limited question which has been
B
raised for consideration is as to whether the rates prescribed by
the appellant under the circular dated 12th June, 2012 could be
applied retrospectively w.e.f. 1st April, 2009 or be effective from
1st April, 2013, as observed by the Tribunal and whether the
appellant is entitled to claim 10% notional increase every year
C from 1 st April, 2009 to be applicable from 1st April, 2013.
[Paras 23,25 and 26][160-D, F-G]
1.2 So far as the impugned circular dated 12th June, 2012
is concerned, it stipulates that it shall be made effective from 1 st
April, 2009 and the rates would revise from 1st April, 2009 with
D 10% annual increase w.e.f. 1st April, 2010, particularly, in the
circumstances when all the infrastructure and other charges are
being paid upfront every year. It is not disputed that each of the
service provider has paid upfront for the previous years from 1st
April, 2009 in terms of the earlier circular dated 30th May, 2006
until the circular dated 12th June, 2012 was introduced. It is a
E settled principle of law that it is the Union Parliament and State
Legislatures that have plenary powers of legislation within the
fields assigned to them, and subject to certain constitutional and
judicially recognized restrictions, they can legislate prospectively
as well as retrospectively. Competence to make a law for a past
F period on a subject depends upon present competence to legislate
on that subject. By a retrospective legislation, the Legislature
may make a law which is operative for a limited period prior to
the date of its coming into force and is not operative either on
that date or in future. [Paras 27-29][160-H; 161-A-D]
G 1.3 The power to make retrospective legislations enables
the Legislature to obliterate an amending Act completely and
restore the law as it existed before the amending Act, but at the
same time, administrative/executive orders or circulars, as the
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BHARAT SANCHAR NIGAM LTD. AND OTHERS ETC. v. 145
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case may be, in the absence of any legislative competence cannot A
be made applicable with retrospective effect. Only law could be
made retrospectively if it was expressly provided by the
Legislature in the Statute. Keeping in mind the afore-stated
principles of law on the subject, applicability of the circular dated
12th June, 2012 to be effective retrospectively from 1st April
B
2009, in revising the infrastructure charges, is not legally
sustainable and to this extent, we are in agreement with the view
expressed by the Tribunal under the impugned judgment. So far
as the submission made by the appellant with regard to the
notional increase of charges by a certain percentage every year
as being referred to in the circular dated 12th June, 2012 is C
concerned, we have not been able to persuade ourselves with
the finding recorded by the Tribunal. The reason is that the
appellant might not be justified in making the circular dated 12th
June, 2012 effective from 1st April, 2009, but once the
competence of the appellant in fixing the rates of infrastructure
D
charges in question stands affirmed and is not a subject matter of
challenge, the appellant is well within its rights to make their
charges leviable on notional fixation by increase of charges by a
certain percentage every year in terms of circular dated 12th
June, 2012 from each of the service provider as being notionally
applicable from 1st April, 2013. In other words, the service E
provider is not under an obligation to pay any additional
infrastructure charges which was prescribed by the appellant
under its circular dated 12th June, 2012 for the previous years,
effective from 1st April, 2009, but at the same point of time, it
was open for the appellant to notionally fix the charges to be
F
computed and became payable from 1st April, 2013, based on
10% annual increase every year or by any other mechanism which
may have a reasonable justification. That such notionally increased
charges can indeed be leviable on the service providers and to
this extent, the order passed by the Tribunal is not sustainable in
law and deserves to be set aside. The order of the Tribunal dated G
20th August, 2014 followed by the order dated 14th October,
2014 are hereby modified and the appellant is at liberty to revise
the notional rates based on 10% increase every year in terms of
circular dated 12th June, 2012 as applicable on 1st April, 2013
and to raise its additional demand/bills based on notional increase
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146 SUPREME COURT REPORTS [2022] 18 S.C.R.
A of infrastructure charges effective as on 1st April, 2013 to the
service providers/respondents herein and if the service
providers/ respondents fail to pay, consequences in terms
of the agreements executed between the parties shall follow.
[Paras 30-32][161-D-H; 162-A-C]
B CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 1699-
1723 of 2015.
From the Judgment and Order dated 20.08.2014 of the Telecom
Disputes Settlement and Appellate Tribunal in Petition Nos.403, 20 of
2013, 577, 578, 579, 583, 584, 586, 612, 620, 655, 660, 666, 817, 818, 819,
C 932, 944, 978 of 2012, 322, 323, 324, 283 of 2013 and Order dated
14.10.2014 in M.A. No.276 of 2014 in Petition No.322 of 2013 and
M.A. No.277 of 2014 in Petition No.324 of 2014.
Tejveer Bhatia, Ms. Vishakha Ahuja, Rohan Swrup, Gaurav
Sharma, Advs. for the Appellants.
D Meet Malhotra, Gopal Jain, Sr. Advs., Mansoor Ali Shoket, Nitin
Kala, Pukhrambam Ramesh Kumar, Kunal Singh, Tanmay Jain, Karun
Sharma, Sunil Kumar Jain, Ms. Pallavi Langar, Kunal Singh, Ravi
Chauhan, Ms. Shally Bhasin, Chaitanya Safaya, Prateek Gandhi, Aakarsh
Kamra, Peehu, Lakshmeesh S. Kamath, Ms. Samriti Ahuja, Ms. Suvarna
E Kashyap, Harsh Kaushik, Ms. Adrija Mishra, Ravi S. S. Chauhan, Ms.
Pallak Singh, Anoop Rawat, Saurav Panda, Prateek Gupta, Ms. S. Singh,
S. S. Shroff, Advs. for the Respondents.
The Judgment of the Court was delivered by
AJAY RASTOGI, J.
F
1. The instant batch of appeals has been preferred by the appellant,
Bharat Sanchar Nigam Ltd. assailing the judgment dated 20th August,
2014 passed by the Telecom Disputes Settlement and Appellate Tribunal,
New Delhi, followed with the order dated 14th October, 2014 rejecting
the application filed by the appellant seeking clarification of judgment
G dated 20th August, 2014 to the extent that the rate of infrastructure charges
for Active Links of Licensed Telecom Service Providers to be charged
in terms of the circular dated 12th June, 2012 has been made effective
from 1st April, 2013 instead of 1st April, 2009 taking note of increase of
10% per annum between 1st April, 2009 to 31st March, 2013 as payable
on 1st April, 2013. As consequence thereto, the revised rates introduced
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by the appellant as per circular dated 12th June, 2012, which although A
were proposed from 1st April, 2009, shall be applicable with effect from
1st April, 2013 but that was declinedby the Tribunal under the order
impugned.
2. It will be apposite to take a narration of facts for better
appreciation of the controversy raised in the instant appeals. B
3. The respondents herein who have been granted licenses under
Section 4 of the Indian Telegraph Act, 1885, for providing telecom services
such as Universal Access Service/Cellular Mobile Telephone Service/
National Long Distance Service, etc. and the service providers entered
into Interconnection Agreements with the appellant which is a public C
sector undertaking for interconnection of their telecom networks with
that of the appellant.
4. Whenever a new operator wishes to start operations, it is
necessary for such an operator to interconnect with various other networks
of the incumbent operators that are already in existence. It is for this D
reason that interconnection as well as the terms on which the same is to
be provided, is regulated by the telecom regulations. The various operators
designate some of their switches/exchanges as points of interconnect
(POI) from which the interconnection facility is provided by a physical
connection on the ports available in such points of interconnect.
Sometimes, the newcomer called the interconnection seeker in common E
parlance, may ask for certain other facilities/resources from the incumbent
operators, which may not be mandated by the regulations, on mutually
agreeable terms.
5. The dispute in the present batch of appeals pertains to charges
for infrastructure facilities which are being provided by the appellant to F
the batch of respondents, which were increased by a circular dated 12th
June, 2012, w.e.f. 1st April, 2009. The question that arose was as to
whether the appellant was justified in raising charges for infrastructure
facilities with retrospective operation from 1st April, 2009, more so, when
the yearly charges are paid by the service providers (respondents) upfront G
in advance every year.
6. Interconnect Agreements are executed between the parties
and as per clause 2.1.9, infrastructure facilities will be provided, subject
to availability and feasibility. Rental for use of such space and mounting
shall be determined by the provider of such facility. As per clause 6.3.3
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148 SUPREME COURT REPORTS [2022] 18 S.C.R.
A of the Interconnect Agreement, it is not mandatory for the appellant to
provide any infrastructure to the respondents, which they are themselves
supposed to arrange. The extract of clauses 2.1.9 and 6.3.3, which are
relevant for the purpose is reproduced hereinbelow:
“Clause 2.1.9
B Irrespective of who owns a transmission system of the link
interconnecting one party’s exchange to the exchange of the
other party, each party subject to availability and feasibility may
provide accommodation for the terminals of such equipment of
the other party located in its premises. Each party may permit
C mounting of antennae for interconnect link owned by the other
party on its transmission towers subject to feasibility. Rental for
use of such space and mounting shall be determined by the
provider of such facility. Arrangements for installation, operation
and maintenance of such equipment will be arrived at by mutual
agreement.”
D
“6.3.3 Other charges
It shall not be mandatory for BSNL to provide any infrastructure
to BSO which BSO himself is supposed to arrange. In case the
BSO is not able to bring his interconnecting transmission link
E upto the BSNL’s designated exchange for the POI, BSNL may
subject to availability and payment of the prescribed charges by
BSO, provide inter exchange junctions on PCMs from the
exchange upto which the BSO has brought its transmission link
to the location of POI. These charges shall be same as prescribed
by TRAI for leased lines from time to time or on R&G &
F conditions as the case may be.
For any other infrastructure like space BSNL’s building, provision
of power supply, air conditioning, mounting of antenna on towers
or building tops if feasible, the charges and other terms &
conditions for the same shall be as prescribed by BSNL from
G time to time separately.”
7. The appellant, in the first instance, by circular dated
19thFebruary, 2001 fixed the rental charges for providing facilities i.e.
accommodation, power supply, tower space, cable ducts, etc. to the
private licensed service providers and it was specifically mentioned that
H
BHARAT SANCHAR NIGAM LTD. AND OTHERS ETC. v. 149
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the appellant reserve the right to renew the charges as well as the A
electricity charges as and when being revised by the State Electricity
Boards. In furtherance thereof, Interconnect Agreements were executed
between the appellant and the respondents/service providers herein earlier
on 31st March, 2004 and it was made explicit that the appellant has no
obligation to provide infrastructure facilities and it is for the respondents/
B
service providers to arrange the same at their own and in case
infrastructure facilities are taken from the appellant, it shall be on the
rates prescribed by the appellant from time to time.
8. In furtherance thereof, the appellant revised the infrastructure
charges for Active Links leased to the operators by its circular dated
30th May, 2006 w.e.f. 1st April, 2006 and all such charges are to be C
leviable upfront every year and the circular indicates the justification of
revising the infrastructure charges based on classification of cities
introduced by the Central Government for the purposes of determining
the House Rent Allowance. The extract of the Circular dated 30th May,
2006, although not under challenge, but may be relevant for proper D
appreciation of the grievance raised by the appellant is reproduced as
under:
“Bharat Sanchar Nigam Ltd.
(A Government of India Enterprise)
E
613-B, Statesman House, B-148,
Barakhamba Road, New Delhi – 110001
(Commercial Branch)
No. 103-1/2006-Comml. Dated: 30th May, 2006
F
Subject: Infrastructure charges for Active Links of
Licensed Telecom Service Providers
In view of various reference received in this office on
the subject, the competent authority has reviewed the
infrastructure sharing charges prescribed vide Circular No.116- G
14/96-PHC (pt) dated 19th February, 2001 and decided to revise
the charges as given below:-
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150 SUPREME COURT REPORTS [2022] 18 S.C.R.
A 2. Definition of links connected to BSNL network:
a. Active Links: These are the links of Licensed Telecom
Service Providers for which transmission equipment of service
provider is installed in BSNL’s exchange premises and their
network is connected through it. The rental charges of
B infrastructure in this case have been streamlined and are given
below in Para 3.
b. Passive Links: These are the links of Licensed Telecom
Service Providers for which their transmission equipment is
installed close to BSNL exchange premises and only transmission
C cable (with/without modem) is brought in the BSNL’s telephone
exchange premises. Charges for this have already been
prescribed vide Circular No.103-4/2004-Comml dated 29th April,
2005.
3. Rental changes for infrastructure sharing have been divided
D into following components:
a. Charges for sharing of building space.
b. Electricity and miscellaneous charges.
c. Charges for Tower sharing.
E d. Charges for duct sharing.
a. Charges for sharing of building space:
(i) To simplify rent assessment, it has been decided to classify
the areas/cities based on the classification followed by
Government of India for House Rent Allowance i.e. A1, A, B1,
F B2 and C class cities. For the sake of simplicity, it has further
been decided to have only in four categories i.e. A (for A1 and
A), B (for B), C (C) and Unclassified cities.
(ii) Accordingly, the rates for one transmission bay (including
space for one box of OF termination and DDF as required) in
G these categories of cities may be charged as under. The space
is normally given in technical area of exchange building, which
is having high specifications for installation of telecom
equipments. The Licensed Telecom Service Providers are given
space for installation of their various equipments by officer-in-
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M/S TATA COMMUNICATIONS LTD. ETC. [AJAY RASTOGI, J.]
charge of building on approval of equipment installation plan by A
Head of SSA:
Categories of City Charges
A Rs.36000 per bay per annum
B Rs.28000 per bay per annum B
C Rs.20000 per bay per annum
Unclassified Rs.13000 per bay per annum
b). Miscellaneous Infrastructure service charges:These
charges include the sharing of following services:
C
1). DCT power at – 48V up to 10A/ transmission
bay;
2). AC power for lights, fans, testing instruments
etc;
3). Air Conditioning charges (sharing of existing D
air conditioning system);
4). Generator Backup;
5). Earthing charges (Tapping from exchange
earth bar is allowed) E
6) Fire equipment (Sharing in case of
requirement).
As the rates of electricity and capital expenditure
of BSNL in developing these facilities is varying as per
the size of city, the rates for one transmission bay in these F
categories of cities will be as under:
Categories of City Charges
A Rs.2,00,000 per bay per annum
B Rs.1,80,000 per bay per annum G
C Rs.1,50,000 per bay per annum
Unclassified Rs.1,20,000 per bay per annum
C. Tower Charges: Charges per antenna will be as
under:
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152 SUPREME COURT REPORTS [2022] 18 S.C.R.
A Sl. Tower HeightAll Cities
1. Up to 30 meters Rs.1,20,000 per annum
2. 31-60 meters RS. 2,50,000 per annum
3. More than 60 meters Rs.4,00,000 per annum
B The above charges will be multiplied by no. of antennas in
case multiple antennas are installed by Licensed Telecom Service
Providers.
d. Duct Charges: Permission may be granted to Licensed
Telecom Service Providers to lay one 50 mm pipe inside the
C BSNL exchange premises to lay their OF cable. It will be the
responsibility of Licensed Telecom Service Providers to restore
telecom exchange building and its premises in original shape
after their construction work is over which should be done within
one month. A refundable security of Rs.50,000 may be obtained
D from Licensed Telecom Service Providers before the permission
is given.
BSNL will not lease its own DUCTs as far as possible.
Duct rental for already leased ducts of BSNL may be continued
to be charged as at present, i.e.:
E =[Cost of Duct x No. of Cable x 36%] /[Total no. of pipes in
duct]
4. Applicability of above charges-
a) These revised rates will be applicable w.e.f. 1st April, 2006
with a provision of 10% annual increase every year i.e.,
F 01.04.2007 onwards. Billing cycle shall be from 01.04 to 31.03
of every year. Hence, billing cycle for all existing links may be
shifted to the new arrangement;
b) All these charges will be leviable in advance every year;
G c) In case of change of classification of cities, high classification
will be applicable at the time of yearly renewal only. The charges
will be applicable financial year wise;
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d) No cash refunds shall be made and any excess payments A
received by BSNL, due to difference in charges based on old
and new formula, shall be adjusted in future bills of party
concerned.
(R P Bhalla)
Assistant Director General (Commercial)” B
9. It may further be noticed that the revised rates applicable w.e.f.
1st April, 2006 with a provision of 10% annual increase every year i.e.
1st April, 2007 onwards and the billing cycle shall be from 1st April to 31st
March and the charges will be leviable upfront in advance every year
with a further stipulation that in case of change of classification/ C
categorization of cities, higher classification will be applicable at the time
of yearly renewal only and charges will be applicable on each financial
year.
10. The Government of India, Ministry of Finance,by its circular
dated 29th August, 2008, revised the classification of cities effective from D
1st September, 2008 and the cities have been revised as follows:
“2. Based on the recommendations of the Sixth Central Pay
Commission, the earlier classification of cities has been revised
viz., A-1 to “X”; A, B-1 & B-2 to “Y” and C & Unclassified to
“Z”. In determining the revised classification, the population of E
Urban Agglomerate area of the city has been taken into
consideration. Accordingly, the rates of House Rent Allowance
shall be as under:
Classification of Rates of House Rent
Allowance F
Cities/Towns as a percentage of (Basic Pay
+
NPA where applicable)
X 30% G
Y 20%
Z 10%
11. The Government of India re-classified the cities w.e.f. 1st
September, 2008 but so far as the appellant is concerned, the circular
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154 SUPREME COURT REPORTS [2022] 18 S.C.R.
A revising the infrastructure charges for telecom service providers in terms
of circular of the Government of India dated 29th August, 2008 came to
be introduced by a circular dated 12th June, 2012, but charges stood
revised retrospectively w.e.f. 1st April, 2009 with a provision of 10%
annual increase every year w.e.f. 1st April, 2010 onwards and rest of
the conditions remained the same. The impugned extract of part of the
B
circular dated 12th June, 2012 is reproduced hereinbelow:-
“Rates & Costing Cell, Bharat Sanchar Nigam Limited
Bharat Sanchar Nigam Limited, A Govt. of India Enterprises
Corporate Office,
C
Janpath,
New Delhi – 110001
No.2-2/2009-R&C[CFA] Dated: 12.06.2012
Circular R&C – CFA No.11/11-12
D
Subject : Infrastructure Charges for Active Links of
Licensed Telecom Service Providers
In view of re-classification of cities and revision of rates of
house rent vide Govt. of India Department of Expenditure letter
E No.2(8)/2008-E-II(B) dated 29.08.2008, the existing rental
charges for Infrastructure Sharing by the other licensed service
providers fixed vide BSNL HQ No.103-1/2006-Comml. Dated
30.05.2006 has been reviewed by Competent Authority and it
has been decided to revise the charges w.e.f. 01.04.2009, as
details given below:
F
1. Charges for building space.
(Rates for one transmission bay including space
for one box OF transmission and DDF as required)
S.No. Classification of Charges w.e.f. 01.04.2009
G
Cities/Towns
1. X Rs.61,606 per annum per bay
2. Y Rs.47,916 per annum per bay
3. Z Rs.26,620 per annum per bay
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2. Misc. Infrastructure Service Charges :These A
chargesincludethesharing of following services.
1. DC power at – 48V up to 10A/transmission bay;
2. AC power for lights, fans, testing instruments etc.;
3. Air conditioning charges (sharing of existing air B
conditioning system);
4. Generator Backup;
5. Earthling charges (Tapping from exchange earth bar
is allowed);
C
6. Fire equipment (sharing in case of requirement).
S.No. Classification of Charges w.e.f. 01.04.2009
Cities/Towns
1. X Rs.2,95,778 per annum per bay
D
2. Y Rs.2,66,200 per annum per bay
3. Z Rs.1,99,650 per annum per bay
3. The other twoinfrastructure Sharing rentals viz Tower
Sharing Charges and Duct Charges, which are not dependent
on re-classification of classification of city and house rent rates, E
shall remain unchanged and be charged as per this office letter
No.103-1/2006-Comml. Dated 30.05.2006.
4. Other terms and conditions applicable to above charges
are:
F
i) These revised rates will be applicable w.e.f.
01.04.2009 with provision of 10% annual increase
every year i.e. 01.04.2010 onwards. Billing cycle shall
be from 01.04.2004 to 31.03.2013 of every year. Hence,
billing cycle for all existing links may be shiftedto the
new arrangement; G
ii) All these charges will be leviable in advance every year;
iii) In case of change of classification of cities,
higherclassification willbe applicable at the time of yearly
renewal only.The charges will be applicable financial
year wise; H
156 SUPREME COURT REPORTS [2022] 18 S.C.R.
A iv) TAXs, duties as per Govt. orders from time to time will
be levied extra.
v) This Circular is issuedbased on the approval of
CompetentAuthority in NOW-CFA file No.6-9/2010-
POI (Infra)(Pt.). For any Clarification/correspondence,
B in this regard, matter may be taken up with NOW-CFA
Section, BSNL Corporate Office, Janpath, New Delhi
– 110001 [Tel No.011-23711795 Fax No.011-23734135].
Sd/-
C (AGM(T&C-CFA)”
12. It may be relevant to note at this stage that the circular dated
12th June, 2012 revised the infrastructure facilities retrospectively w.e.f.
1st April, 2009, however, the fact is that all the telecom service providers
have made their payments for the previous years in terms of the circular
D dated 30th May, 2006 according to the terms of Interconnect Agreements
where the charges are leviable upfront every year and after introducing
the circular dated 12th June, 2012 w.e.f. 1st April, 2009, additional bills
were raised by the appellant for the previous years for which the upfront
payment was made by each of the telecom service provider and that
E became the subject matter of challenge at the instance of the telecom
service providers (respondents herein) by approaching the Tribunal.
13. The learned Tribunal, after taking note of the submissions and
the pleadings on record, arrived to a conclusion that the appellant is well
within its rights to revise the rates according to classification of cities
F and it was for the respondents to continue to use the resources of the
appellant at the revised rates or take the same from other resources if
available andit was open to the service provider to avail the infrastructure
facilities such as building space, etc. either from the appellant or from
any other service provider, if any.
14. The limited question which the Tribunal considered was
G
regarding the rates prescribed by the appellant under the circular dated
12th June, 2012 could have been made applicable retrospectively w.e.f.
1st April, 2009 and taking into consideration the backdrop of the matter,
while upholding the right of the appellant (BSNL) to revise the rates of
the infrastructure facilities in question held that the circular dated 12th
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M/S TATA COMMUNICATIONS LTD. ETC. [AJAY RASTOGI, J.]
June, 2012 of the appellant shall be applicable prospectively w.e.f. 1 st A
April, 2013, which is the next financial year instead of 1st April, 2009 and
upto 31st March, 2013, the infrastructure facilities provided by the
appellant to the telecom service providers shall be charged at the rates
and as per classification of cities prescribed in the circular dated 30th
May, 2006 and the consequential effect is either for refund or for
B
realization of charges, if any, the same may be accounted for by the
appellant in terms of the judgment impugned dated 20th August, 2014.
Relevant extract of the judgment dated 20th August, 2014 is reproduced
hereinbelow:
“In view of the aforesaid circumstances, while upholding
the right of the respondent-BSNL to revise the rates of the C
infrastructure facilities in question, we direct that the revised
rates as per the circular dated 12.06.2012 of the Respondent
shall be applicable with effect from 01.04.2013 which is the
next financial year. Up to 31.03.2013, the infrastructure facilities
provided by the respondent to the petitioners shall be charged at D
the rates and as per classification of cities as prescribed in the
circular dated 30.05.2006. The excess rates, wherever realised
from the petitioners, shall be refunded back to the petitioners
along with interest at the rate as is prescribed in the interconnect
agreements for delayed payments from the date of realization
of these amounts and till the time of filing of the petitions along E
with pendente lite and future interest @9% till the payment is
made. The refunds shall be made within a period of four weeks.
If any amount is found payable by the petitioners in terms of this
order, the same shall also be paid along with interest, as payable
in case of refunds, and shall be paid within four weeks.” F
15. The appellant, at this stage, filed an application before the
Tribunal seeking clarification of the judgment and order dated 20th August,
2014 on the premise that the rate of infrastructure charge for active
links of licensed telecom service providers indicated in the circular dated
12th June, 2012 has become effective from 1st April, 2013 instead of 1st G
April, 2009. In the given circumstances, the 10% notional increase per
annum between 1st April, 2009 to 31st March, 2013 is leviable and can
be charged from 1st April, 2013 but that application was dismissed by the
Tribunal by its later order dated 14th October, 2014 with a clarification
that the revised rates as per the circular dated 12th June, 2012 shall be
H
158 SUPREME COURT REPORTS [2022] 18 S.C.R.
A applicable w.e.f. 1st April, 2013 and the rates which were applied w.e.f.
1st April, 2009 are to be applied w.e.f. 1st April, 2013 without any notional
increase and consequently disposed of the application filed by the
appellant. Relevant extract of the order dated 14th October, 2014 is
reproduced hereinbelow:
B “We, however, do not find any such direction in the
judgment. On the contrary, if the rates mentioned in this circular
are to be taken w.e.f. 01.04.2009 and then notionally increased
by certain percentage every year to arrive at a rate to be
applicable from 01.04.2013, it will be contrary to the letter and
spirit of the judgment. The direction in the judgment is clear that
C revised rates as per the circular dated 12.06.2012 shall be
applicable w.e.f. 01.04.2013 and, therefore, the rate which was
applied as per the circular w.e.f. 01-04-2009 is to be applied
w.e.f. 01.04.2013 without any notional increase. We, however,
make it clear that this will be without prejudice to the right of the
D respondent-BSNL to revise the rates prospectively, and in
accordance with the agreement between the parties.”
16. That both the orders passed by the Tribunal dated 20th August,
2014 and 14th October, 2014 became the subject matter of challenge in
the instant batch of appeals before us.
E 17. It may be further noticed that in furtherance of the circular
dated 12th June, 2012, circular dated 13th May, 2015 has been notified
revising the infrastructure charges for active links of licensed telecom
service providers w.e.f. 1st April, 2015 leviable in advance for the year
2015-16 onwards and the justification tendered by the appellant was
F that it is based on commercial viability and enhanced maintenance cost
and the appeals filed by the service providers assailing the circular dated
13th May, 2015 came to be dismissed by the Tribunal by judgment dated
18th October, 2019 and the appeal preferred against the judgment of the
Tribunal came to be dismissed by this Court by an order date 17th February,
2020 in Civil Appeal No.1438 of 2020.
G
18. Counsel for the appellant in the first instance has tried to
persuade this Court that the rate of infrastructure charges stood revised
on the basis of the circular issued by the Government of India, Ministry
of Finance, revising the classification of cities vide its circular dated 29 th
August, 2008 and that became effective from 1st September, 2008 and it
H
BHARAT SANCHAR NIGAM LTD. AND OTHERS ETC v. 159
M/S TATA COMMUNICATIONS LTD. ETC. [AJAY RASTOGI, J.]
was the reason for which the circular dated 12th June, 2012 became A
effective in revising the infrastructure charges for telecom service
providers w.e.f. 1st April, 2009.The appellant revised the rates based on
the classification of cities and such revision was permissible in relation
to commercial agreementsduly supported with the evidence on record.
19. Counsel for the appellant further contended that once the B
competence of the appellant in laying down the charges has been upheld
by the Tribunal, retrospective application to the circular dated 12th June,
2012 should not have been interfered with by the Tribunal, but in the
next breath, has submitted that if the retrospective applicability of the
circular dated 12th June, 2012 effective from 1st April, 2009 is not
sustainable, at least the appellant is within its rights to make the charges C
leviable after notional fixation by increase of 10% every year w.e.f. 1st
April, 2009 and,to this extent, the finding of the Tribunal is not legally
sustainable and deserves to be interfered with by this Court.
20. Counsel further submits that so far as the notional fixation of
charges to be effective from 1st April, 2013 is concerned, in terms of D
circular dated 12th June, 2012, there is a provision of 10% annual increase
every year w.e.f. 1st April, 2010 onwards and,in the given circumstances,
even if the infrastructure charges as levied by the appellant to be charged
from service providers at the revised rates applicable w.e.f.1st April,
2009 are not chargeable because of the impugned judgment of the Tribunal E
still the service providers are under an obligation to pay w.e.f. 1st April,
2013 the notional increase of charges based on 10% annual increase
and this was a manifest error which the Tribunal has committed in passing
the judgment impugned and the same needs to be interfered with by this
Court.
F
21. Counsel for the respondents,on the other hand,submits that
the right of the appellant to revise the rate of infrastructure facilities
indeed after the finding has been recorded by the Tribunal has not been
questioned by the respondents in the later proceedings, but if the circular
dated 12th June, 2012 could not be given retrospective effect w.e.f. 1st
April, 2009, at least no notional increase of 10% every year could have G
been permissible to be charged from the service providers w.e.f. 1st
April, 2013 and if that is being made permissible, what could not have
been directly chargeable from the service providers can be indirectly
charged at the rates which the appellant is entitled to claim as the
infrastructure charges w.e.f. 1st April, 2013 and that was the reason the H
160 SUPREME COURT REPORTS [2022] 18 S.C.R.
A Tribunal intervened in the matter and clarified in its latter order that
there shall be no notional increase of 10% every year as being indicated
in the circular dated 12th June, 2012 and the appellant is under an obligation
to charge the rates as applicable on 1st April, 2009 to be applied w.e.f.
1st April, 2013 without any notional increase. The circular dated 12th
June, 2012 applicable prospectively w.e.f. 1st April, 2013 was to be
B
purposively interpreted and the plea of notional increase by 10% every
year in revising the rates, to be charged from 1st April, 2013 is not legally
sustainable.
22.Counsel for the respondents, while supporting the finding
recorded by the Tribunal under the impugned judgment,further submits
C that if what is being prayed for by the appellant is accepted by this
Court, each service provider will have to bear the additional financial
burden for the period for which they have not charged any additional
charge from their customers and since the respondents have not charged
from their customers for the previous years from 1st April, 2009 onwards,
D it will carry a financial burden on the service providers for which they
are not at fault.
23. As a matter of fact, the present dispute survives regarding
payment of infrastructure charges for the limited period of two years
i.e. from 1st April, 2013 to 31st March, 2015.
E 24. We have heard learned counsel for the parties and with their
assistance perused the material available on record.
25. That the authority of the appellant in revising the infrastructure
charges for active links leased to telecom operators is not a subject
matter of challenge and none of the respondents have questioned the
F authority of the appellant in revising the infrastructure charges for active
links leased to telecom operators.
26. The limited question which has been raised for our consideration
is as to whether the rates prescribed by the appellant under the circular
dated 12th June, 2012 could be applied retrospectively w.e.f. 1st April,
G 2009 or be effective from 1st April, 2013, as observed by the Tribunal
and whether the appellant is entitled to claim 10% notional increase
every year from 1st April, 2009 to be applicable from 1st April, 2013.
27. So far as the impugned circular dated 12th June, 2012 is
concerned, it stipulates that it shall be made effective from 1st April,
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BHARAT SANCHAR NIGAM LTD. AND OTHERS ETC v. 161
M/S TATA COMMUNICATIONS LTD. ETC. [AJAY RASTOGI, J.]
2009 and the rates would revise from 1st April, 2009 with 10% annual A
increase w.e.f. 1st April, 2010, particularly, in the circumstances when
all the infrastructure and othercharges are being paid upfront every year.
28. It is not disputed that each of the service provider has paid
upfront for the previous years from 1st April, 2009 in terms of the earlier
circular dated 30th May, 2006 until the circular dated 12th June, 2012 B
was introduced.
29. It is a settled principle of law that it is the Union Parliament
and State Legislatures that have plenary powers of legislation within the
fields assigned to them, and subject to certain constitutional and judicially
recognized restrictions, they can legislate prospectively as well as C
retrospectively. Competence to make a law for a past period on a subject
depends upon present competence to legislate on that subject. By a
retrospective legislation, the Legislature may make a law which is
operative for a limited period prior to the date of its coming into force
and is not operative either on that date or in future.
D
30. The power to make retrospective legislations enables the
Legislature to obliterate an amending Act completely and restore the
law as it existed before the amending Act, but at the same time,
administrative/executive orders or circulars, as the case may be, in the
absence of any legislative competence cannot be made applicable with
retrospective effect. Only law could be made retrospectivelyif it was E
expressly provided by the Legislature in the Statute. Keeping in mind
the afore-stated principles of law on the subject, we are of the view that
applicability of the circular dated 12th June, 2012 to be effective
retrospectively from 1st April 2009, in revising the infrastructure charges,
is not legally sustainable and to this extent, we are in agreement with the F
view expressed by the Tribunal under the impugned judgment.
31. So far as the submission made by the appellant with regard to
the notional increase of charges by a certain percentage every year as
being referred to in the circular dated 12th June, 2012 is concerned, we
have not been able to persuade ourselves with the finding recorded by G
the Tribunal. The reason is that the appellant might not be justified in
making the circular dated 12th June, 2012 effective from 1st April, 2009,
but once the competence of the appellant in fixing the rates of
infrastructure charges in question stands affirmed and is not a subject
matter of challenge, the appellant is well within its rights to make their
H
162 SUPREME COURT REPORTS [2022] 18 S.C.R.
A charges leviable on notional fixation by increase of charges by a certain
percentage every year in terms of circular dated 12th June, 2012 from
each of the service provider as being notionally applicable from 1st April,
2013. In other words, the service provider is not under an obligation to
pay any additional infrastructure charges which was prescribed by the
appellant under its circular dated 12th June, 2012 for the previous years,
B
effective from 1st April, 2009, but at the same point of time, it was open
for the appellant to notionally fix the charges to be computed and became
payable from 1st April, 2013, based on 10% annual increase every year
or by any other mechanism which may have a reasonable justification.
That such notionally increased charges can indeed be leviable on the
C service providers and to this extent, the order passed by the Tribunal, in
our considered view, is not sustainable in law and deserves to be set
aside.
32. Consequently, the appeals stand partly allowed. The order of
the Tribunal dated 20th August, 2014 followed by the order dated 14th
D October, 2014 are hereby modified and the appellant is at liberty to revise
the notional rates based on 10% increase every year in terms of circular
dated 12th June, 2012 as applicable on1st April, 2013 and to raise its
additional demand/bills based on notional increase of infrastructure
charges effective as on 1 st April, 2013 to the service providers/
respondents herein and if the service providers/respondents fail to pay,
E consequences in terms of the agreements executed between the parties
shall follow.
33. Pending application(s), if any, shall stand disposed of.
Divya Pandey Appeals partly allowed.
F (Assisted by : Bodhi Ramteke, LCRA)
G
H
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