Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2026 Supreme(SC) 165

SUPREME COURT OF INDIA
Pamidighantam Sri Narasimha, Atul S. Chandurkar, JJ.
State Bank Of India – Appellant
Versus
Union Of India & Ors. – Respondents
Civil Appeal No(s). 1810 of 2021 With Civil Appeal No(S). 2227 of 2021 With Civil Appeal No(S). 4570 of 2021 With Civil Appeal No(S). 2263 of 2021 With Civil Appeal No(S). 4571 of 2021 With Civil Appeal No(S). 6546 of 2021
Decided On : 13-02-2026

Advocates appeared:
For the Appellant(s) : Mr. Gurmeet Singh Makker, AOR Mr. Gopal Jain, Sr. Adv. (Arguing Counsel) Mr. Shyam Divan, Sr. Adv.(Arguing Counsel) Mr. Anoop Rawat, Adv. Ms. Misha, Adv. Mr. Vaijayant Paliwal, Adv. Mr. Saurav Panda, Adv. Ms. Charu Bansal, Adv. Ms. Mohna Nijhwan, Adv. Mr. Shreyas Gupta, Adv. Ms. Mohana Nijhawan, Adv. Ms. Kirti Gupta, Adv. Mr. S. S. Shroff, AOR Mr. Rohan Batra, AOR Mr. Dhruv Dewan, Adv. Mr. Rishabh Bhargava, Adv. Mr. Dhruv Sethi, Adv. Mr. Harsh Vardhan Arora, Adv. Ms. Sanjukta Roy, Adv. Ms. Shailza Agarwal, Adv. Mr. Rakesh Dwivedi, Sr. Adv.(Arguing Counsel) Mr. Raunak Dhillon, Adv. Mr. Madhav Kanoria, Adv. Ms. Aishwarya Gupta, Adv. Ms. Niharika Shukla, Adv. Mr. Anchit Jasuja, Adv. Mr. Eklavya Dwivedi, Adv. Mr. Yasir, Adv. M/S. Cyril Amarchand Mangaldas Aor, AOR
For the Respondent(s): Mr. R. Venkataramani, Attorney General for India (Arguing Counsel) Mr. K.M Nataraj, A.S.G. Mr. Digvijay Dam, Adv. Mr. Balaji Srinivasan, Adv. Mr. Akshay Amritanshu, Adv. Mr. Kanu Agrawal, Adv. Mr. S.k Singhania, Adv. Ms. Sansriti Pathak, Adv. Mr. Shashank Shekhar, Adv. Mr. Kartikay Aggarwal, Adv. Mr. Ameyavikrama Thanvi, Adv. Mr. Raman Yadav, Adv. Mr. Amrish Kumar, AOR Mr. Rohan Batra, AOR Mr. Dhruv Dewan, Adv. Mr. Rishabh Bhargava, Adv. Mr. Dhruv Sethi, Adv. Mr. Harsh Vardhan Arora, Adv. Ms. Sanjukta Roy, Adv. Ms. Shailza Agarwal, Adv. Mr. S. S. Shroff, AOR Mr. Rakesh Dwivedi, Sr. Adv. (Arguing Counsel) Mr. Raunak Dhillon, Adv. Mr. Madhav Kanoria, Adv. Ms. Aishwarya Gupta, Adv. Ms. Niharika Shukla, Adv. Mr. Anchit Jasuja, Adv. Mr. Eklavya Dwivedi, Adv. Mr. Yasir, Adv. M/S. Cyril Amarchand Mangaldas Aor, AOR

Spectrum is considered a finite natural resource, thus its ownership remains with the government and cannot be treated as an asset under the Insolvency and Bankruptcy Code.

Headnote:(A) Telecommunications Law - Spectrum Allocation - Principles governing ownership of spectrum as a natural resource and IBC - Court defines spectrum as a finite natural resource under the constitutional public trust doctrine, administered by the government on behalf of citizens. It cannot be treated as an asset under IBC as TSPs do not possess ownership rights. (Paras 1.1, 70, 9, 12, 30)

(B) Ownership vs. Possession - The distinction between ownership of spectrum and usage rights under licensing agreements ruled upon. TSPs possess only a right to use, which is conditional and revocable. (Paras 9, 70)

(C) Legal Framework - The government holds exclusive authority over spectrum allocation under the Telegraph Act and licensing provisions; financial creditors cannot claim priority over regulatory compliance. (Paras 37, 61, 68)

(D) Insolvency and Bankruptcy Code, 2016 - Not applicable to spectrum usage rights, as TSPs lack ownership rights; usage falls under operational dues, preserving the government’s regulatory powers. (Paras 69, 70) (E) Conclusion - Appeals by financial institutions against NCLAT decisions dismissed regarding claims for licenses in insolvency proceedings; government’s claim upheld. (Result) Appeals are dismissed other than part-allowed for Union of India. (Para 69)

Judgement Key Points

This judgment addresses the core issue of whether spectrum allocated to telecom service providers (TSPs) constitutes an "asset" of the corporate debtor under the Insolvency and Bankruptcy Code, 2016 (IBC), amenable to insolvency resolution proceedings, moratorium, or transfer, or whether it remains a finite natural resource owned by the government under the public trust doctrine, with TSPs holding only conditional, revocable usage rights [judgement_subject][1] (!) [13][30][33][34][36][45][54][58][60][61][62][63][69].

It examines the interplay between telecom laws (governing spectrum as a sovereign privilege) and IBC, rejecting the treatment of spectrum usage rights as proprietary assets for restructuring while upholding government dues and regulatory control (!) (!) [18][24][26][28][29][37][40][43][64][66][67][68][69].

Table of Content
1. determination of ownership and control over spectrum. (Para 1)
2. factual background on telecom licensing and related debts. (Para 2 , 3 , 4 , 5 , 6)
3. arguments regarding the treatment of spectrum as an asset. (Para 11 , 12)
4. insolvency code cannot apply to spectrum. (Para 40 , 45 , 46 , 48)
5. conclusion on spectrum's status under insolvency law. (Para 69)

JUDGMENT :

Contents

I.	Introduction
II.	Prelude to the NCLAT’s judgment: Facts leading to the filing of these appeals
III.	Submissions of the Learned Counsels
	A. Submission on behalf of TSPs and financial institutions
	B. Submissions on behalf of DoT/Union of India
IV.	Nature of Spectrum and the Constitutional Framework Governing the Natural Resources
	A. Spectrum as a Finite Natural Resource
	B. Concept of ownership over natural resources and its Constitutional Underpinnings
V.	Statute, Policy and Contractual Framework Governing Spectrum Allocation, Licensing and Use
	A. Statutory Framework of Spectrum
	B. ...The Successive Telecom Policies including unbundling of licensing spectrum allocation
	C. Guidelines for Trading of Access Spectrum by Access Service Providers, 2015
	D. Spectrum Licenses and Contract
	E. Tripartite Agreement
VI.	The Insolvency and Bankruptcy Code, 2016
	A. First principles
	B. Difficulty in Expecting NCLAT to rule on Spectrum
	C. Implications of Treating Spectrum as an Asset by TSPs/Corporate Debtor and the Financial Institutions
VII.	Identification of True Legal Province of Spectrum: Reconciliatory Interpretation of Two Statutory Regimes
VIII.	Conclusion

I. Introduction

1. The question for our consideration is whether telecom service providers (TSPs), called upon to pay the license dues by the Department of Telecommunication (DoT) can invoke moratorium on the basis of voluntary corporate insolvency resolution process under Insolvency and Bankruptcy Code, 2016 (IBC) for restructuring of their assets. The asset in question is the Spectrum allocated to the TSPs through auction. The endeavour to treat spectrum as an asset in the hands of TSPs gives rise to a fundamental question as to its ownership, possession, use, transfer, or assignment. Its definition and legal province are the subject matter of our inquiry.

1.1. This issue is not as complicated as it seems. We could demystify the legal challenge by first understanding spectrum as a material resource, precisely as what our Constitution refers to as the material resource of the community. If that be so, it is easy to find the path by simply following the State policy to ensure that spectrum and its benefits sub-serve common good - not uncommon good. For this purpose, its “ownership” and more importantly its “control” with all its attributes, including benefits, have to be secured for the citizens.

1.2. Our judgment is therefore in three parts. In the first part, we define the legal implications of spectrum and in the second part we identify its true legal province. In the third part, we examine treatment of an “asset” under IBC and in this context its application to telecommunication laws that govern ownership of spectrum. Finally, we could reach our conclusion, as naturally as water knows its slope, IBC cannot be the guiding principle for restructuring the ownership and control of spectrum.

II. Prelude to the NCLAT’s judgment: Facts leading to the filing of these appeals.

2. The Aircel Group entities - Aircel Limited, Aircel Cellular Limited and Dishnet Wireless Limited (hereinafter collectively referred to as “the corporate debtors”) - were granted telecom licences by the DoT under Unified Access Service Licences (UASL) pursuant to Licence Agreements dated 05.12.2006, each valid for a term of twenty years. Domestic lenders, including the State Bank of India, extended rupee term loan facilities aggregating to

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2026 Supreme(SC) 165

Spectrum is considered a finite natural resource, thus its ownership remains with the government and cannot be treated as an asset under the Insolvency and Bankruptcy Code.

Cases Referred (24)

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