[AGR Case] 'Why Shouldn't Jio Pay Dues Of Reliance Communications For Using Its Spectrum?' SC Asks Reliance Jio [Read Order]

The Supreme Court on Friday stated that Reliance Jio must pay Reliance Communications' AGR dues in light of the fact that it was using the latter's spectrum since 2016."Justice Mishra: Jio is using since 2016. Why should we not ask Jio if they are using the spectrum. Who are the beneficiaries? It is shocking state of affairs if revenue is not shared and spectrum is used by somebody else?"A bench of Justices Arun Mishra, S. Abdul Nazeer & MR Shah directed the Centre, Reliance Jio and Reliance Communication's to produce necessary documents in order to bring to light who would be liable for AGR dues of Reliance Communications. The bench also sought details of who was using the spectrum of Aircel and Videocon. "We have directed them to place on record the information relating to Agreement entered into with respect to using of spectrum by the respective parties. In the case of RCOM, its spectrum of 800 MAZ is being used by Reliance Jio from 2016. Let the agreement entered into between the parties be placed on record",states the Order.Similar direction is issued to other companies which are under insolvency, including Aircel Limited, Aircel Cellular Limited and Dishnet Wireless Limited and Videocon Telecommunications Ltd. to specify who is using the spectrum an arrangement along with documents be placed on recordSenior Advocate Shyam Divan appearing for Reliance Communications submitted that a part of the spectrum was lying idle and the other part was being used by Jio basis a contractual agreement.Divan: There is a part of my spectrum lying idle with me. I have an asset sharing contractual arrangement with Jio and that has been reported to the DOT and the fee to liberalize such spectrum has been paid.Senior Advocate KV Vishwanathan appearing for Jio submitted that "there was something called "Spectrum Sharing Guidelines and Spectrum Trading Guidelines". "I am sharing a part of it. AGR is paid by my side" he said.The Justice Mishra-led bench at this juncture, stated that "Spectrum is owned by the Sovereign".Justice Mishra: Spectrum is nobody's property. It is Government's. It is public money. It is a revenue sharing regime.The bench stated that it was the "Master of the Spectrum", adding that the NCLT & NCLAT could not have allowed it to be used sans payment of dues.ORDEREvery detail of proceeding should be made clear by the CoC and the Resolution Professional as well as by the counsel appearing 4 for the respective companies. Let affidavits be filed in this regard along with requisite documents, orders/proceedings of NCLT/NCLAT and offers/plan by Resolution Professional/CoC submitted before the NCLT be also placed on record and what is the proposal regarding sale of the assets and who is the proposed purchaser be also clearly culled out in the affidavit supported by the documents.The Department of Telecommunications (DoT) to make it clear in whose name and from which date the spectrum is being used and how much fees/dues of AGR year-wise and amount deposited with it for using of the same by the respective companies under some inter se arrangements of the companies and the dates thereof. Let DoT file an affidavit with respect to its stand reflected in the order passed by this Court on 20.02.2019. Let DoT also file the requisite documents in this regard supported by an affidavit of Secretary of the Department of Telecommunication.It will now come up for further hearing on August 17.On August 10, Court had sought the Centre's response on whether Telecom Spectrum can be sold/auctioned in the insolvency proceedings faced by the telecom companies.The Court posed this query while examining the bona fides of bankruptcy claims of Reliance Communications, Aircel and Videocon.In 2016, Airtel had bought Aircel's 4G airwaves in the 2,300 MHz band and Videcon's spectrum. Earlier this year, the National Company Law Tribunal (NCLT) approved the sale of Aircel's assets to UV Asset Reconstruction Company (UVARCL).On August 7, the Top Court had reserved orders in the plea by Department of Telecommunications (DoT) seeking to allow telecom companies to make payments of the AGR dues in a staggered fashion over 20 years.The bench had also made it clear that it shall not entertain any objections for re-assessment/ re-calculation of AGR in light of the decision passed by Top Court in October 2019 and directed Reliance Communications, Sistema, Shyam Teleservices & Videocon to submit their insolvency details within 7 days.Court noted that, in doing so it needed to ensure that the IBC was not being misused by companies in order to escape liabilities.While warning all parties to dispense with payments pertaining to public revenue as had already been directed by the Court, the Justice Arun Mishra led bench expressed reservations regarding keeping the payment of dues pending."What is the guarantee that you will not escape? Some of you are foreign companies and may even go into liquidation. What is the security that you can give us?" Justice...

[AGR Case] 'Why Shouldn't Jio Pay Dues Of Reliance Communications For Using Its Spectrum?' SC Asks Reliance Jio [Read Order]

Sanya Talwar

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