The Delhi high court on Thursday refrained from stopping the spectrum allocation exercise initiated by the government, but said the distribution of frequency depends on the final outcome of the petition filed by GSM operators grouping COAI.
Hearing the petition, Justice Gita Mittal said: "Anything done by (the Centre) in furtherance of an application made by Reliance will be subject to the outcome of this writ petition."
COAI had challenged the order of telecom tribunal TDSAT, which had refused to stay the process of spectrum allocation. The Delhi High Court also issued notices to the Centre, regulator TRAI and telecom operators Reliance Communication and Tata Teleservices among others.
The court also sought a response from HFCL, Shyam Telelink, BSNL and MTNL on the issue within one week and rejoinder, if any, within a week thereafter.
Solicitor General Goolam E Vahanvati gave an assurance that the government will first deal with the allocation of additional spectrum, start-up spectrum and cross-over spectrum in that order.
The counsel for Reliance Communication, a CDMA operator which has applied for GSM spectrum under the dual technology policy, submitted that the company had applied for GSM spectrum way back in February 2006.
The court also directed the Centre to produce the application filed by RCom in February 2006.
RCom's counsel Harish Salve contended that GSM operators were creating confusion regarding its GSM license. The company had applied for the licence in February 2006 and not on October 18 as was being portrayed. The CDMA licence, which was granted in 2003, does not bar the company from acquiring the GSM licence, he said.
However, COAI, which engaged a battery of top lawyers such as Ram Jethmalani, argued that government gave RCom a priority and announced its decision to permit use of dual technology on late afternoon of October 19.
DoT's decision to allow use of dual technology to RCom and others is "unfair, unreasonable and legally malafide" and denies an equal opportunity to GSM operators, Jethmalani said.
"I have never seen such a case of public fraud. Reliance is governing the country which is evident from the fact the government has collected the money (Rs 1,650 crore or Rs 16.50 billion) in the morning of October 19," Jethmalani said.
He also questioned the Rs 1,650 crore price fixed for the frequencies, which he said was public property and should be allocated only through open auction.
COAI counsel Fali S Nariman also questioned the government's decision to allow the use of dual technology. "Cross over technology cannot be permitted in the existing policy," Nariman said, adding it should be done only after amending the telecom policy of 1999.
The government, however, said dual technology was recommended by regulator TRAI. It was in public interest and there was no logic opposing dual technology as it eventually increases competition and benefits consumers.
Additional Solicitor General Gopal Singh, who assisted Vahanvati, said the government has decided to go by TRAI's recommendations which were lenient than Telecom Engineering Centre's suggestions for allocation of additional spectrum.
After hearing the parties for almost two-and-a-half hours, the court was reluctant to pass any order but said: "Nothing is going to happen in 4-5 days. The moment anything happens, you (petitioner) come to the court."
It also directed the parties not to take adjournment in TDSAT and posted the matter for hearing on January 31.
The court was hearing a petition filed by COAI seeking stay of the government's October 18 and 19 decisions to permit the use of dual technology and regulator TRAI's recommendation of enhanced subscriber-linked criteria for allocation of additional spectrum. COAI had also sought quashing of December 12 direction of TDSAT that allowed the government to allocate spectrum and give new licences.