Union Of India vs Tata Teleservices (Maharashtra) Ltd

1. This appeal by the Union of India, the respondent in a proceeding before the Telecom Disputes Settlement & Appellate Tribunal (for short, the TDSAT) in a petition filed by the respondent herein under Section 14 of the Telecom Regulatory Authority of India Act, 1997 (for short the Act) is under Section 18 of the Act. 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.

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.

18. We, thus, allow this appeal and setting aside the decision of the TDSAT, remand the claim and the counter- claim for a fresh adjudication and disposal in accordance with law. We leave the parties to suffer their respective costs in this Court.