On the issue of review and curative petitions, experts see limited ground for relief on Spectrum Usage Charges (SUC)-related AGR liability and on payment timelines. Your comments?
Since this was a cabinet decision, I think the government should be aggrieved that a decision taken by the Government of India has, in a sense, been turned down by the court. Remember, the time frame during which payments should be made is something that the government decides as a matter of policy, in the context of the grave financial situation that the telecom sector is facing.
Normally courts do not comment on the context of the terms of payments. That the court has done so is something that the government should be aggrieved about — and if so, it should be filing a review petition. Whether telecom operators file a review petition or not: it is for each of them to take a decision separately on that. Review petitions are normally not allowed. As far as curative is concerned, that’s, of course, a call that telecom operators will have to take.
Do you think the apex court asking the managing directors of telecom companies to furnish personal guarantees and undertakings to abide by the order is a concern over which you may seek relief?
Yes, it is a concern. Normally MDs should not be asked to file personal guarantees because ultimately it is a corporate liability. And unless that liability itself is supported by guarantees — that’s a separate issue. But if it is not, then courts would normally not pass such an order. That should be addressed by telecom operators, who should take a call on what should be done to seek some relief on that account.
You also appeared today, on behalf of the construction industry, on the issue of the moratorium. The Supreme Court has said that no account should be declared NPA (non-performing asset) for two months and the banks should not take coercive action against borrowers. Hearings will continue September 10 onwards. But what are the issues here?
In a sense, that is already built into the policy. You can falter. But you will be an NPA only after the 60-day period. So that’s already built in. But I think the intent is to ensure that whatever the status was on August 31, that status will continue till the court decides what is to be done.
Do you see the issue of whether spectrum can be traded under IBC (Insolvency and Bankruptcy Code) as something that will eventually end up in the Supreme Court?
That’s a matter of real concern for me. I think the whole purpose of the trading policy framework was the optimal use of spectrum. If somebody is not in a position to use spectrum, then that is not optimal use.
If spectrum at the time of trading cannot be given as security, then the whole telecom sector will be in deep trouble. For an operator, that is the most valuable asset he has. If the bank cannot use that as security, what else can he pledge?
It is also an indication that when courts take decisions, unaware of the economic consequences of those decisions, then it can have a very damaging effect, not only on the sector but also on the economy of the country. And, therefore, banks should be allowed to accept spectrum as security and spectrum should be allowed to be traded, subject to that security.