Summary
Under the interconnect agreements, BSNL charges telecom licensees for infrastructure at its exchanges, such as building space, power and towers, at rates it prescribes, payable upfront every year. After the Government reclassified cities for House Rent Allowance in 2008, BSNL's circular of 12 June 2012 revised the charges with effect from 1 April 2009, with a 10% annual increase from 2010, and raised additional bills for past years already paid. TDSAT upheld BSNL's right to revise but made the circular operative only from 1 April 2013, without any notional increase for the intervening years. The Supreme Court agreed that an administrative circular cannot operate retrospectively. But because BSNL's competence to fix the rates was unchallenged, it could levy from 1 April 2013 rates notionally increased at 10% a year from the 2009 base. The appeals were partly allowed.
Issues
- Whether BSNL's circular of 12 June 2012 revising infrastructure charges could operate retrospectively from 1 April 2009 where charges had already been paid upfront
- Whether, on the circular applying from 1 April 2013, BSNL could levy rates notionally increased by 10% a year from 1 April 2009
Held
- Parliament and the State Legislatures may legislate retrospectively within their fields, but administrative or executive orders and circulars, in the absence of legislative competence, cannot be given retrospective effect. BSNL's circular could therefore not apply from 1 April 2009 to years for which the service providers had already paid upfront under the 2006 rates, and TDSAT's view to that extent was upheld. (¶¶ 28, 29, 30)
- Since BSNL's authority to fix infrastructure charges was affirmed and not challenged, it may compute the charges payable from 1 April 2013 by applying the 10% annual increase to the 2009 base rates, or another reasonably justified mechanism. The service providers owe nothing additional for the years before 1 April 2013, but TDSAT erred in barring the notional increase. (¶¶ 25, 31)
Result
Appeals partly allowed. TDSAT's orders of 20 August 2014 and 14 October 2014 were modified to let BSNL raise additional bills from 1 April 2013 on the notionally increased rates. Non-payment attracts the consequences under the agreements.