ARB. P. No. 236 of 2012. Case: Viom Network Ltd Vs S. Tel Pvt. Ltd. High Court of Delhi (India)
| Case Number | ARB. P. No. 236 of 2012 |
| Counsel | For Petitioner: Sanjay Jain Sr. Advocate, Ms. Anuradha Mukherjee, Abhijit Mittal, J. P. Sengh Sr. Advocate, Omar Ahmad, Manu, Advs. and For Respondents: Dayan Krishan, Gautam Narayan, Amit Gupta, Ms. Asmita Singh, Nikhil Menon, S. Rana, Sudhir Nandrajog Sr. Advocate, Sanjay Bhatt, Abhishek Anand, Advs. |
| Judges | Rajiv Sahai Endlaw, J. |
| Issue | Telecom Regulatory Authority of India Act (24 of 1997) - Sections 2(1)(j)(k), 14; Arbitration and Conciliation Act (26 of 1996) - Sections 8, 9; Telegraph Act (13 of 1885) - Section 4 |
| Citation | AIR 2014 Del 31 |
| Judgement Date | November 11, 2013 |
| Court | High Court of Delhi (India) |
Judgment:
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The common objection of the respondent S Tel Pvt. Ltd. to all these petitions is that, notwithstanding the existence of the arbitration clause in the agreement, subject-matter of each of these petitions, between the petitioner / its predecessor and the respondent, the remedy of arbitration under the Arbitration and Conciliation Act, 1996 (Arbitration Act) is not available for the reason of the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) having the exclusive jurisdiction over the disputes raised, under Section 14 read with Section 15 of the Telecom Regulatory Authority of India Act, 1997 (TRAI Act).
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Both the petitioners i.e. Viom Network Ltd. and Bharti Infratel Ltd. are a Telecom Infrastructure Service Provider registered as Infrastructure Provider Category-I (IP-I) with the Department of Telecommunications (DoT) and are engaged in the business of building, owning or validly possessing and operating passive infrastructure sites and providing passive telecom infrastructure service to various telecom operators. The respondent S Tel Pvt. Ltd. was on the contrary, a telecom operator, having acquired Unified Access Service Licences to establish, install, operate and maintain Unified Access Service in the areas / circles of Jammu and Kashmir, Himachal Pradesh, Bihar, Orissa, Northeast and Assam. The licences of the respondent S Tel Pvt. Ltd. were however cancelled following the orders of the Supreme Court.
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Under each agreement, titled "Master Services Agreement", containing the arbitration clause, the petitioners Viom Network Ltd. and Bharti Infratel Ltd. had agreed to, i) make available and provide to the respondent S Tel Pvt. Ltd. access to their passive infrastructure sites to install S Tel's equipment and to operate and maintain the same; and ii) provide specified operation and maintenance services at each of the said sites.
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Disputes and differences have arisen between the petitioners and the respondent under the said Agreements, which contained a clause for lock in period, with the petitioners claiming monies from the respondent under the Agreements. The petitioners have accordingly invoked the arbitration clause in the agreement subject-matter of each petition and have sought interim relief with respect to the active infrastructure equipment of the respondent installed at the sites of the petitioners and upon the failure of the respondent to appoint Arbitrator / join in appointment of Arbitrator, also sought appointment of Arbitrator. The petitioners, in the OMPs under Section 9 of the Arbitration Act, seek to restrain the respondent from removing, selling, encumbering the said equipment and also receivership of the said equipment to settle their dues for which award is sought in the arbitration proceedings.
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M/s. IDBI Trusteeship Ltd. applied for intervention in the OMPs preferred by M/s. Viom Pvt. Ltd., claiming first charge over the said equipment.
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Finding, that owing to the telecom licences of the respondent having been cancelled and the respondent being now no longer in need of the said active infrastructure equipment and further that the said equipment may with the passage of time deteriorate and become obsolete, vide order dated 18.04.2013, without prejudice to the respective contentions, provision was made for auction thereof and deposit of the sale proceeds with the Registrar General of this Court. Subsequent orders dated 6th August, 2013 and 24th September, 2013 were also made in this regard.
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The counsel for the respondent has contended that the petitioners as well as the respondent are 'service providers' within the meaning thereof in the TRAI Act and therefore it is the TDSAT which has exclusive jurisdiction to entertain and adjudicate the disputes between the two service providers. Reliance is placed on judgment of the TDSAT in Reliance Infratel Ltd. v. Etsalat DB Telecom P. Ltd. MANU/TD/0056/2012 holding that entities registered with DoT as Infrastructure Provider Category-I are service providers within the meaning of TRAI Act and Section 14 of the TRAI Act vests TDSAT with the jurisdiction to adjudicate disputes between service providers and that with regard to matters covered by Section 14 of the TRAI Act, only TDSAT has jurisdiction, notwithstanding the existence of an arbitration clause in a contract between two service providers. Reference is also made to Booz Allen and Hamilton Inc. v. SBI Home Finance Ltd. (2011) 5 SCC 532: (AIR 2011 SC 2507) in paras 35 to 37 whereof it was inter alia held that the Arbitral Tribunals are private fora chosen voluntarily by the parties to the dispute to adjudicate their dispute in place of Courts and per contra the Tribunals constituted under the laws of the country are public fora and that adjudication of certain categories of proceedings is reserved by the legislature exclusively for public fora as a matter of public policy. Reference in this regard is also made to the judgment dated 15.03.1940 of the Privy Council in The Secretary of State v. Mask and Co. (AIR 1940 PC 105) and to Modi Rubbers Ltd. v. Union of India, MANU/DE/1148/2002 (DB). It is further contended that though the respondent had before the TDSAT and in the appeal against the judgment of TDSAT before the Supreme Court argued to the contrary but has now accepted the judgment of the TDSAT. It is yet further contended that though the appeal against the judgment of the TDSAT is pending but there is no stay therein. Attention is invited to Section 3 (1-AA) of The Indian Telegraph Act, 1885, (Telegraph Act) to contend that all appliances, instruments, apparatus, not only used but even capable of use for transmission and reception of signals, are included in the definition of "Telegraph" and it is contended that the instruments and equipments of petitioners are so capable and thus "telegraph" within the meaning of Telegraph Act and thus the need for petitioners to be within the jurisdiction of TDSAT. It is yet further contended that the services provided by petitioners are not akin to providing or letting office space. After the orders were reserved, copy of order dated 02.09.2013 of an Arbitral Tribunal in arbitration between Vodafone Spacetel Ltd., an infrastructure provider as the petitioners herein and the respondent S Tel Pvt. Ltd. allowing the application of respondent S Tel Pvt. Ltd. under Section 16 of the Arbitration Act for the reason of the dispute being not arbitrable was also handed over.
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Per contra the senior counsels for the petitioners have contended:
(i) that the services being provided by the petitioners are not telecommunication services within the meaning of Section 2(1)(k) of the TRAI Act and thus the petitioners are not service providers within the meaning of Section 2 (1) (j) of the said Act and the TDSAT has no jurisdiction over the petitioners; reliance is placed on paras 3.7 and 3.8 of the Recommendations dated 12th April, 2011 of the Telecom Regulatory Authority of India (TRAI) to show that the same also does not treat the IP-I certificate holders as licencees;
(ii) that the petitioners are neither a licensor or a licensee nor a service provider within the meaning of Section 14 of the TRAI Act;
(iii) that no consumer is affected at least today by the action of the petitioners inasmuch as the telecom licence of the respondent stands cancelled;
(iv) that today even the respondent is not a service provider; however on enquiry it was conceded that Section 14 may include an ex-service provider;
(v) that the petitioners are not "Licensee" within the meaning of Section 2(1)(e) of the TRAI Act;
(vi) that the petitioners are akin to a landlord; reference is made to the judgment of TDSAT in Aircel Digilink India Ltd. v. Union of India, MANU/TD/0001/2005;
(vii) that the certificate obtained by the petitioners from DoT was in pursuance to the clause in the agreements with the respondent and the said certificate, by no stretch of...
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