SC dismisses Loop Telecom's plea seeking refund of licence fee

The Supreme Court on Thursday dismissed the Loop Telecom plea seeking a refund of Rs 1454.94 crore paid by it as entry fees for 2G licences for 21 service areas.

A bench of Justices Dhananjaya Y Chandrachud, Surya Kant and Vikram Nath dismissed the petition filed by Loop Telecom and Trading Limited.

"We have come to the conclusion that there is no merit in the appeals. The appeals are accordingly dismissed," the court said.

Loop Telecom has claimed a refund of Rs 1454.94 crore representing the entry fee (together with interest) paid by it for 2G licences for 21 service areas. Following the judgment of the top court in the Centre for Public Interest Litigation (CPIL) versus Union of India case, 2G licences granted by the central government, including to the appellant, were quashed.

The appellant Loop Telecom had filed a petition before the TDSAT raising the issue of a refund of the entry fee, on the ground that it had been exonerated by the Special Judge, CBI. By a judgment of December 21, 2017, the appellant Loop Telecom was acquitted of criminal charges by the Special Judge.

The TDSAT, with its judgement of December 11, 2018, had dismissed the Second Telecom Petition noting that the appellant had made a second attempt for claiming the same relief which had been sought earlier in the First Telecom Petition.

The supreme court said that the acquittal of the promoters of the appellant Loop Telecom of these criminal charges does not efface or obliterate the findings which are contained in the final judgment of the top Court in CPIL matter relating to 2G licences.

The top court on Thursday said that it has come to the conclusion that the appellant was in part delicto with DoT and the then officials of the Union government.

"The appellant (Loop Telecom) was the beneficiary of the --First Come First Serve policy which was intended to favour a group of private bidding entities at the cost of the public exchequer. The contention of the appellant that it was exculpated from any wrongdoing by the judgment of this Court in CPIL .....(supra) is patently erroneous," the Court said.

"The need for an open and transparent bidding process for the allocation of natural resources was substituted by a process which was designed to confer unlawful benefits on a group of selected bidders by which the appellant benefitted. The appellant has tried to obviate these findings by relying on its acquittal by the Special Judge, CBI," the Court said.

"It is important to note that the criminal trial before the Special Judge, CBI was limited to the question as to whether the promoters of the appellant had cheated the DoT by providing a false representation of its compliance with Clause 8 of the UASL Guidelines since it was allegedly being controlled by the Essar group. The Special Judge, CBI acquitted the promoters of the appellant since the prosecution was unable to prove that: (i) officers of DoT considered the representation of the appellant to be false; (ii) the appellant was engaged in a sham transaction, or (iii) the appellant was actually controlled by the Essar group, " the Court said.

"Hence, the acquittal of the promoters of the appellant of these criminal charges does not efface or obliterate the findings which are contained in the final judgment of this Court in CPIL (supra), " the court said.

"In any event, such a course of action before the TDSAT was clearly in the teeth of the judgment of this Court in CPIL (supra), " it added.

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