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2010 (7) Supreme 252
SUPREME COURT OF INDIA
Markandey Katju and T.S. Thakur, JJ.
Bharti Cellular Limited — Appellant
versus
Union of India & Ors. — Respondents
Civil Appeal No.7026 of 2003
Decided on : 5-10-2010
(2009) 14 SCC 253; (1981) 1 SCC 537; AIR 1993 SC 352; Civil Appeal No. 7236 of 2003 – Relied upon
Facts of the case:
1. The appellant-company holds a licence to provide cellular mobile telephone services for Delhi Metro area.
2. The Licence Agreement provided for payment of fixed amount towards licence fee for the first three years of the licence period. From the fourth year onwards the licence fee payable was to be on the basis of number of subscribers of the service provider subject to the minimum stipulated in the agreement.
3. The appellant’s case before the Tribunal was that although it had a provisional operational clearance from the respondent effective from 29thAugust, 1995 and an interface/service approval from 26thSeptember, 1995, it could commence commercial services only from 15th November, 1995 meaning thereby the Licence Agreement should be deemed to have become operative only from 15th November, 1995.
4. The respondents, however, treated 26th September 1995 i.e. the date when the interface/service clearance was given as the date of commencement of the Licence Agreement and computed the licence fee dues, interest, penal interest, liquidated damages etc. with reference to the said date.
5. The appellant also questioned the method of computing the number of subscribers for determining the licence fee payable from the fourth year onwards contending that the term “subscribers” should be understood to be such as have activated cellular mobile telephone connection from the appellant and as are currently activated and used by a person for which bills are issued by the appellant.
6. A few other disputes were also raised by the appellant in the petition filed on its behalf.
7. One other grievance of the appellant was regarding the Unit Call Rate for the purpose of calculation of the licence fee.
8. Telecom Disputes Settlement Appellate Tribunal, New Delhi, has dismissed in part the petition filed by the appellant and upheld the computation of licence fee demanded and realized by the respondent-Union of India in terms of the Licence Agreement executed between the parties.
Finding of the Court:
The view taken by the Tribunal is legally unexceptionable.
Result : Appeal dismissed.
The ratio of the case primarily revolves around the principle that a party who unconditionally accepts a settlement or benefit under a certain package or agreement cannot later turn around and dispute or reject the terms of that package, especially if they have given up all prior disputes related to the matter. This is encapsulated in the maxim "qui approbat non reprobat," meaning "one who approbates cannot reprobate" (!) .
In this context, the court emphasized that once the appellant accepted the Migration Package unconditionally and abandoned all disputes relating to the License Agreement for the specified period, it was not permissible for the appellant to subsequently raise disputes or objections concerning those very issues (!) (!) . The court upheld the principle that acceptance of a package or settlement, which involves relinquishing certain rights or claims, binds the party to the terms and prevents retraction or rejection of those terms later on (!) .
Therefore, the core legal principle or ratio in this judgment is that unconditional acceptance of a settlement or package, which includes waiving prior disputes, estops the party from re-agitating those disputes subsequently. This reinforces the doctrine that benefits and burdens under an agreement are to be accepted together, and one cannot accept the benefits while rejecting the burdens or conditions attached to them.
JUDGMENT
T.S. Thakur, J. —
1. This appeal under Section 18 of the Telecom RegulatoryAuthority of India Act, 1997 is directed against an orderdated 23rdMay, 2003 passed by the Telecom DisputesSettlement Appellate Tribunal, New Delhi, whereby theTribunal has dismissed in part the petition filed by theappellant under Section 14 (a)(I) of the Act and upheld thecomputation of licence fee demanded and realized by therespondent-Union of India in terms of the LicenceAgreement executed between the parties.
2. The appellant-company holds a licence to providecellular mobile telephone services for Delhi Metro area.TheLicence Agreement executed between the appellant on theone handandtheGovernment of India ontheother,interalia, provided for payment of fixed amount towards licencefee for the first three years of the licence period. From thefourth year onwards the licence fee payable was to be onthe basis of number of subscribers of the service providersubject to the minimum stipulated in the agreement. Clause19 of the Licence Agreement in particular dealt with thisaspect and, inter alia, provided that for the first three yearsa lump sum licence fee shall be chargeable annually and that the year shallbe reckoned asthe period of twelvemonths beginning with the date of commissioning of the services or completion of twelve months from the date of the signing of the licence whichever is earlier.
3. The appellant’s case before the Tribunal was thatalthough it had a provisional operational clearance from therespondent effective from 29thAugust, 1995 and aninterface/service approval from 26thSeptember, 1995, itcould commence commercial services only from 15thNovember, 1995 meaning thereby the Licence Agreementshould be deemed to have become operative only from 15thNovember, 1995. The respondents, however, treated 26thSeptember 1995 i.e. the date when the interface/serviceclearance was given as the date of commencement of theLicence Agreement and computed the licence fee dues,interest, penal interest, liquidated damages etc. withreference to the said date. The appellant also questioned themethod of computing the number of subscribers fordetermining the licence fee payable from the fourth yearonwards contending that the term “subscribers” should beunderstood to be such as have activated cellular mobiletelephone connection from the appellant and as arecurrently activated and used by a person for which bills areissued by the appellant. A few other disputes were alsoraised by the appellant in the petition filed on its behalf. Oneof them related to the alleged illegality and arbitrarycomputation of the advance payment stipulated for theentire quarter as due in the month of June itself andcalculation of the interest and penal interest on the overdueamount. One other grievance of the appellant was regardingthe Unit Call Rate for the purpose of calculation of thelicence fee.It was contended by the appellant that in termsof the Licence Agreement the rate of Rs.5 lakhs per 100subscribers was based on the Unit Call Rate of Rs.1.10. Thisrate was revised by the respondent to Rs.6.023 lakhs per100 subscribers or part thereof on 30thJuly 1998 based onthe Unit Call Rate of Rs.1.40 prevalent at that time. Unit CallRate was then reduced to Rs.1.20 from 1stMay, 1999. Theappellant, therefore, claimed that the calculation of thelicence fee payable for the period from 1st May, 1999 to 31stJuly, 1999 should be on the basis of the then Unit Call Rateprevalent, namely, Rs.1.20 only.
4. The respondent contested the petition on severalgrounds giving rise to the following four issues which theTribunal framed for determination:
(i) Whether the methodology adopted by the Respondent for arriving at the number of subscribers from the 4th year of the Licence Agreement was in order?
(ii) Whether the Respondent could charge interest on the licence fee payable by the Petitioner as demanded by the Respondentinlettersdated10thAugust 1999and 6th March 2000?
(iii) Whether the Petitioner is
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