The Supreme Court on 27 November 2012 said the government's plan to conduct another airwaves sale before March 2013 to find bidders for unsold spectrum, could 'create complications',
and also asked the Centre to explain why it did not sell all radio frequencies vacated by companies whose permits were cancelled earlier this year.
The court further said that companies that won back their licences in the recently-concluded auctions must pay market price for airwaves during the interim period. The apex court had quashed 122 permits issued by former telecom minister A Raja in February this year and initially allowed these companies to operate for four months (till June), but later extended this to January 2013 after the government sought more time to complete the spectrum auctions.
"Now the government has arrived at a (market) price. Those who were allowed to continue at the end of four months despite license cancellation, would now have to pay the new price (for that period) arrived at after auction," Justice GS Singhvi said while hearing the 2G case alongside Justice KS Radhakrishnan.
Senior Supreme Court lawyer Meet Melhotra said the SC order implied that companies such as Telenor, Videocon and Idea Cellular must pay the auction-determined fee retrospectively from June till the date on which they are awarded airwaves they won in the recently-concluded sale. "This has serious implications for these companies for no fault of theirs, as the delay in the auctions was caused by the government," he said.
A senior government official said his 'understanding was that the court had only made an observation and not issued any directive' asking these companies to pay for spectrum retrospectively.
The official also added that clarification would emerge only after the apex court releases its orders on this issue. Senior counsel PP Rao, appearing for the government, defended the Centre's decision not to sell all airwaves vacated by the quashed licences in the recently concluded auction and said that some spectrum had been held back to execute the 'refarming policy'. Refarming involves reallocation of the efficient 2G spectrum held by incumbents when their permits come up for renewal beginning 2014.