CPIL v. UOI Flashcards
1
Q
CPIL v. UOI
Year of Decision
Bench Strength
A
2012 2 Judges (Singhvi + AK Ganguli)
2
Q
CPIL v. UOI
Facts
A
Petitions challenging award of Unified Access Service Licence (UAS) to private telecom operators from September 2007 to March 2008 on a first-cum-first-served basis at the price fixed in 2001 to ineligible applicants. The issue was whether the procedure adopted by the DoT of the licenses was vitiated due to arbitrariness and malafides and was contrary to public interest.
3
Q
CPIL v. UOI
Issues
A
- right of government to alienate / transfer / distribute natural resources without following a fair and transparent method that is consistent with the principle of equality
- legality of methodology evolved by TRAI for allocation of 2G spectrum on the basis of 2001 price
- legality of policy allocation of grant of license on first-come-first-served basis.
4
Q
CPIL v. UOI
How are natural resources treated under law?
A
- Natural resources belong to the people but the State legally owns them on behalf of its people. Natural resources are considered as national assets.
- The State is empowered to distribute natural resources. However, as they constitute public property/national asset, while distributing natural resources, the State is bound to act in consonance with the principles of equality and public trust and ensure that no action is taken which may be detrimental to public interest.
- Constitutionalism must be reflected at every stage of the distribution, transfer or alienation of natural resources. This is the mandate of Arts. 38, 39, 48, 48A and 51A(g)
- International law recognizes the principle of permanent sovereignty (of peoples and nations) over (their) natural resources.
- Common Law recognizes States as having the authority to protect natural resources insofar as the resources are within the interests of the general public.
- The State is deemed to have a proprietary interest in natural resources and must act as guardian and trustee in relation to the same. (The Trusteeship Principle)
- Airwaves / frequency are public property and are limited. They must by used in the best interest of society. [Ministry of Information and Broadcasting. v. Cricket Assn of Bengal] Spectrum is also a scarce resource and must be similarly protected.
5
Q
CPIL v. UOI
Which cases deal with the Public Trust Doctrine?
A
- The American doctrine of Public Trust (developed in Illonois Central Railroad Company .v People of State of Illonois) has been adopted in India in:
(i) MC Mehta v. Kamal Nath
(ii) Intellectuals Forum v. State of AP
(iii) Fomento Resorts v. Minguel Martis.
6
Q
CPIL v. UOI
Elements of Public Trust Doctrine
A
The basic elements of the public trust doctrine are:
- It enjoins the government to protect resources for the enjoyment of the general public rather than to permit their use for private ownership / commercial purposes.
- Imposes limits on the government agencies on behalf of the people and also future generations.
- Places an implicit embargo on the right of the State to transfer public properties to private parties if such transfer prejudices public interest.
- Mandates affirmative state action for effective management of natural resources.
- Empowers citizens to question ineffective management of such resources.
7
Q
CPIL v. UOI
Fields of application of Public Trust Doctrine
A
- The public trust doctrine is usually used in environmental jurisprudence, but it has its broader application as well. [RNRL v. RIL]
8
Q
CPIL v. UOI
What are the two facets of the doctrine of equality in its application qua distribution of natural resources by the State?
A
- As natural resources are public goods, the doctrine of equality must guide the State in determining the actual mechanism for distribution of natural resources.
- The doctrine of equality has two concepts:
- first, it regulates the rights and obligations of the State vis-a-vis its people and demands that the people be granted equitable access to natural resources and/or its products and that they are adequately compensated for the transfer of the resource to the private domain
- second, it regulates the rights and obligations of the State vis-a-vis private parties seeking to acquire/use the resource and demands that the procedure adopted for distribution is just, non-arbitrary and transparent and that it does not discriminate between similarly placed private parties.
9
Q
CPIL v. UOI
Finding on TRAI’s recommendation to fix 2001 price
A
- Although, TRAI itself had recognised that spectrum was a scarce commodity, it made recommendation for allocation of 2G spectrum on the basis of 2001 price by invoking the theory of level playing field.
- TRAI completely overlooked that one of the main objectives of NTP 1999 was that spectrum should be utilised efficiently, economically, rationally and optimally and there should be a transparent process of allocation of frequency spectrum.
- In terms of the decision taken by the Council of Ministers in 2003 to approve the recommendations of the Group of Ministers the DoT and Ministry of Finance were required to discuss and finalise the spectrum pricing formula. TRAI’s recommendations were contrary to the decision of the Council of Ministers
- Though TRAI is an expert statutory body assigned with important functions, it cannot make recommendations overlooking the basic constitutional postulates.
- The entry fee determined in 2001 ought to have been treated by the TRAI as wholly unrealistic for grant of licence along with start up spectrum in 2007-08.
10
Q
CPIL v. UOI
Legality of First-Come-First-Served Policy
A
FCFS Policy is fundamentally flawed because:
- it involves an element of pure chance or accident
- Any person who has access to the power corridor may be able to obtain information about a possible distribution of public property and get a head start in the queue.
- When it comes to alienation of scarce natural resources like spectrum etc., it is the burden of the State to ensure that a non-discriminatory method is adopted for distribution and alienation, which would necessarily result in protection of national/public interest.
- A duly publicised auction conducted fairly and impartially is perhaps the best method for discharging this burden
