Asso.Of Unified Tele.Serv.Prov.& Ors vs Union Of India & Ors

CIVIL APPEAL NO. 4591 OF 2014 [Arising out of SLP (C) No. 1804 of 2014] AND CIVIL APPEAL NO. 4592 OF 2014 [Arising out of SLP (C) No. 2925 of 2014]

arbitrary and transparent and that it does not discriminate between similarly placed private parties.”

b) “current cost” means cost after depreciation; and

c) “fixed assets” includes sub-heads such as building, plant and machinery, etc. (2) Every service provider shall intimate to the Authority the place where the books of accounts and other documents are maintained.”

and in each case to report on the expenditure, transactions or accounts so audited by him.”

51. CAG has, therefore, a duty to examine and satisfy himself that all the rules and procedures in that behalf are being met not only by the Union but also the service providers as a whole, since both, the Union, as well as the service providers, are dealing with the natural resources. CAG’s function is, therefore, separate and independent, which is not similar to the audit conducted by the DoT under Clause 22.5 or special audit under Clause 22.6. CAG’s function is only to ascertain whether the Union of India is getting its due share, while parting with the right to deal with its exclusive privilege to the Service Providers, who are dealing with a national wealth, to that extent, Rule 5(1)(ii) has to be read down, but the service providers are bound to make available all the books of accounts and other documents maintained by them under Rule 3, so as to ascertain whether the Union of India is getting its full share of revenue.

53. The Telecom Service Providers approached the Telecom Disputes Settlement and Appellate Tribunal (for short ‘the Tribunal’) and filed two petition Nos. 139 and 141 of 2010 seeking following reliefs:

qua-non for exercise of the power conferred on DOT having not been complied with, the impugned letters are liable to be quashed.

(iv) The invoices and other documents supporting the books of accounts maintained by the petitioner would be voluminous keeping in view the fact that Vodafone alone has about 200 million subscribers.

151. The Tribunal also examined the principles laid down in Anisminic Ltd. V. Foreign Compensation Commission 1969 (1) All England Reporter 208 on the question of “jurisdictional error” and took the view that, after the special audit had been conducted, the question of having another audit in terms of Clause 22.5 of the Conditions of License would not arise. Holding so, the Tribunal set aside the communications dated 16.3.2010 and 10.5.2010 and allowed the petitions with costs of Rs.50,000/. Aggrieved by the same, these two appeals have been preferred.

[Emphasis Supplied]

2. The above mentioned information should be sent directly to DDG (Accounts), Department of Telecommunications, Room No. 701, Sanchar Bhavan, 20, Ashoka Road, New Delhi 110 001 within 15 days from date of issue of this letter.

Sd/- 16.3.2010 (Shashi Mohan) Director (AS-IV)”

64. Clause 22.3(a) specifically states that the licensor or TRAI shall have a right to call for and the licensee shall be obliged to supply and provide for examination any books of accounts that the licensee may maintain in respect of the business carried on to provide services under this license at any time “without recording any reasons thereof”. In other words, while issuing the communication dated 10.5.2010, DoT or TRAI is not expected to record any reasons and that they can summon books of accounts in respect of the business at any time, from the UAS Licence holders.

The time and venue of the presentation is given in Annexure-I. Shri Subu R. Director (Report) of my office has been nominated as Nodal Officer who would be overseeing and coordinating the audit.

Regards Yours sincerely, Sd/-

R. P. Singh”

66. Both the communications dated 16.3.2010 and 10.5.2010, referred to above, clearly indicate that CAG intends to conduct the Audit, since there is “revenue sharing” between the Union of India and the UAS licence holders and the revenue generated will have to be credited to the Consolidated Fund of India.

70. We, therefore, find no merit in the appeals filed by the Service Providers and hence those appeals are dismissed, as above. The appeals filed by the DoT and others are, however, allowed, setting aside the judgment of the Tribunal. In the facts and circumstances of the case, there will be no order as to costs.

……..……………………J. (K.S. Radhakrishnan) ……..……………………J. (Vikramajit Sen) New Delhi, April 17, 2014.