Case: Union Of India Vs. S Tata Teleservices (Maharashtra) Ltd

The respondent approached the TDSAT praying for a declaration that the action of the Union of India in raising a claim and in recovering the amount as per its demand dated 10. 8. 1999, was bad in law and be set aside, for a declaration that the set off made by invoking condition 19 of the licence the respondent had with the appellant in respect of the Maharashtra Service Area was illegal and unauthorised and for setting aside the same, for directing the appellant to refund an amount of Rs. 50 crores together with interest from the date of the purported set off of that amount with the amounts due to the respondent till the date of refund and for other consequential and incidental reliefs. In answer, the appellant contended that it was entitled to make the set off and the set off made was authorised and legal and that there is no reason to interfere with the set off and the respondent was not entitled to the recovery of Rs. 50 crores with interest thereon. A claim that the appellant is entitled to recover as damages from the respondent a sum of Rs. 654. 25 crores towards the loss suffered by it on account of the respondent herein failing to fulfil its obligations under the Letter of Intent issued to it in respect of the Karnataka telecom Circle was also put forward. The TDSAT upheld the claim of the respondent, rejected the claim of the appellant that it was entitled to a legal or equitable set off of the sum of Rs. 50 crores and more importantly held that it has no jurisdiction to entertain a counter claim at the instance of the appellant. Of course, it was also pointed out that the counter claim itself was not properly framed and was somewhat vague. Thus the claim of the respondent was accepted and a direction was issued to the appellant to refund the sum of Rs. 50 crores to the respondent with interest thereon at 17 per cent per annum from the date the said amount was appropriated by the appellant till its payment along with costs of the proceedings. This adjudication of the TDSAT is challenged in this appeal.

Reasoning:
If we hold that the counter claim is maintainable, necessarily the same would have to be adjudicated on, on merits and the result of such an adjudication would have impact on the plea of set off put forward by the appellant. Of course, if our answer to the said question is that the counter claim is not maintainable, then we have to decide independently whether the finding entered by the TDSAT on the plea of set off is vitiated by a substantial error of law or not. We will, therefore, first tackle the question whether the counter claim made by the Union of India was maintainable.( 4 ) IT may be true that in the prayer portion in the written statement an order or decree in terms of the counter claim had not been sought for by the appellant. But the claim as made in the written statement relates to the claim based on the failure of the respondent, after having conveyed its acceptance of the Letter of Intent to provide service in the Karnataka Telecom Circle and the damages allegedly suffered by the appellant as a consequence and the entitlement of the appellant to reimbursement of the specified sum from the respondent. Even if there is some vagueness in the counter claim, as felt by the TDSAT, we think that the TDSAT might have directed the appellant before us, to make its counter claim more specific and in a proper manner. After all, a defect of deficiency could be permitted to be cured. We are, therefore, not impressed by the argument on behalf of the respondent before us that the counter claim was rather vague and the same was rightly rejected for that reason by the TDSAT. After all, this vagueness can be directed to be removed in the interests of justice, if it were to be held that the counter claim can be maintained by the Union of India.(9 ) THE conspectus of the provisions of the Act clearly indicates that disputes between the licensee or licensor, between two or more service providers which takes in the Government and includes a licensee and between a service provider and a group of consumers are within the purview of the TDSAT. A plain reading of the relevant provisions of the Act in the light of the preamble to the Act and the Objects and Reasons for enacting the Act, indicates that disputes between the concerned parties, which would involve significant technical aspects, are to be determined by a specialised tribunal constituted for that purpose. There is also an ouster of jurisdiction of the civil court to entertain any suit or proceeding in respect of any matter which the TDSAT is empowered by or under the Act to determine. The civil court also has no jurisdiction to grant an injunction in respect of any action taken or to be taken in pursuance of any power conferred by or under the Act. The constitution of the TDSAT itself indicates that it is chaired by a sitting or retired Judge of the Supreme court or sitting or a retired Chief Justice of the High Court, one of the highest judicial officers in the hierarchy and the members thereof have to be of the cadre of secretaries to the Government, obviously well experienced in administration and administrative matters.( 10 ) THE Act is seen to be a self contained Code intended to deal with all disputes arising out of telecommunication services provided in this country in the light of the national Telecom Policy, 1994. This is emphasised by the Objects and Reasons also.( 11 ) NORMALLY, when a specialised tribunal is constituted for dealing with disputes coming under it of a particular nature taking in serious technical aspects, the attempt must be to construe the jurisdiction conferred on it in a manner as not to frustrate the object sought to be achieved by the Act. In this context, the ousting of the jurisdiction of the Civil Court contained in Section 15 and Section 27 of the Act has also to be kept in mind. The subject to be dealt with under the Act, has considerable technical overtones which normally a civil court, at least as of now, is ill-equipped to handle and this aspect cannot be ignored while defining the jurisdiction of thethe purpose for which the Act is brought into force and the tdsat is created, we think that there is no warrant for accepting such a narrow approach or to adopt such a narrow construction. It will be appropriate to understand the scope of Section 14 (a) (i) of the Act and for that matter Section 14 (a) (ii) of the Act also, as including those to whom licenses were intended to be issued and as taking in also disputes that commence on the tender or offer of a person being accepted. In other words, a dispute commencing with the acceptance of a tender leading to the possible issue of a licence and disputes arising out of the grant of licence even after the period has expired would all come within the purview of Section 14 (a)of the Act. To put it differently, Section 14 takes within its sweep disputes following the issue of a Letter of Intent pre grant of actual licence as also disputes arising out of a licence granted between a quondam licensee and the licensor.(17 ) IN the light of our finding that the counter claim was maintainable and it requires to be investigated, we think that the proper course is to set aside the finding rendered by the TDSAT on the plea of set off raised by the appellant. This is in view of the fact that acceptance of the counter-claim or even a part thereof might throw open the question of legal or equitable set-off, to be considered in the light of the finding on the counter-claim. Therefore, we think this to be an appropriate case where we should reopen the whole matter without going into the merits of the contentions of parties on the plea of set off raised by the appellant and leave the question to be decided by the TDSAT along with the counter claim that has been made by the appellant. On taking note of the objection that the counter claim has not been made specific and has not been put forward in a proper manner, we are satisfied that it would be appropriate to direct the appellant to make a proper counter claim before the TDSAT within three months from today. The TDSAT thereafter will give the respondent an opportunity to file its written statement to the counter claim and then decide the claim made by the respondent and the counter claim afresh in accordance with law.