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2G: SC says auction order not for all natural resources

The Supreme Court has held the 2G Presidential Reference as maintainable and said public good was above revenue maximisation.


Updated:September 27, 2012, 2:46 PM IST
2G: SC says auction order not for all natural resources
The Supreme Court has held the 2G Presidential Reference as maintainable and said public good was above revenue maximisation.

New Delhi: In a major relief for the government, the Supreme Court on Thursday clarified that the auction order in the 2G scam was only restricted to telecom spectrum and not for all natural resources. The Supreme Court has held the 2G Presidential Reference as maintainable.

A five-judge Constitution Bench headed by Chief Justice SH Kapadia has also clarified that its opinion has no bearing on the 2G order. Apart from Chief Justice Kapadia, the Constitution Bench also consisted of justices DK Jain, JS Khehar, Dipak Misra and Ranjan Gogoi. While upholding the Presidential Reference the court said that public good was above revenue maximisation.

The court has refused to answer all the eight questions raised in the Presidential Reference and answered only two questions.

The apex court bench also said that the policy of auction has not got a Constitutional mandate. The court said that it cannot prescribe a method of allocation of natural resources but can undertake judicial scrutiny on a case to case basis.

The Centre had moved the Presidential Reference on whether auctioning of natural resources is mandatory in line with its 2G spectrum judgement. The Centre had sought clarity on which resources needed to be auctioned and which ones could be allotted on a first-come-first-serve basis.

The court had on February 2, 2012, cancelled 122 2G licences and had said natural resources should be distributed through a public auction.

The government had on April 12 moved the Reference signed by the then President Pratibha Patil in which eight questions were raised, including whether there could be judicial interference in policy matters, vis-a-vis disposal of natural resources and investments made by foreign investors under multi and bilateral agreements.

"Whether the judgement lays down that the permissible method for disposal of all natural resources across all sectors and in all circumstances is by the conduct of auction," the Reference had stated.

"Whether the court holds that within the permissible scope of judicial review that the policy is flawed, is the court not obliged to take into account investment made under the said policy including the investment made by foreign investors under the multi and bilateral agreements," it said.

It sought the court's opinion on "whether the judgement is required to be given retrospective effect so as to unsettle the licences issued for 2G spectrum and allocated after 1994 till 2008."

The Reference also touched upon the 3G spectrum allocated through "auction" and wanted to know the implications of the judgement on it.

"Whether 3G spectrum acquired through the auction in 2010 by entities whose (2G) licences have been quashed in the judgement stands withdrawn," it asked.

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