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Payment of AGR dues: Harish Salve concludes arguments, hearing in SC to continue tomorrow [LIVE UPDATES]

The Court is hearing arguments in the AGR dues case on the question of whether spectrum can be sold under IBC proceedings.

Bar & Bench

The Supreme Court Bench led by Justice Arun Mishra is hearing the case concerning the payment of Adjusted Gross Revenue (AGR) dues by telecommunications companies.

During the hearing yesterday, Senior Advocate Harish Salve had submitted before the Court that right to use licence for spectrum use can be subject matter of IBC proceedings.

Salve, representing Jio, had also told the Court yesterday that the Jio has cleared all of its dues towards AGR including the charges incurred for using Reliance Communications' spectrum under Spectrum sharing agreement.

Read and account of yesterday's hearing:

Salve's arguments will continue today.

Live updates of the hearing today feature on this page.

Salve resumes his arguments.

Salve is taking the Court through Sections 13 and 14 of the IBC, says he is addressing the Court on the issue of whether IBC covers natural resources.

Supreme Court asks to be assisted on Section 18 of the IBC.

Salve: It is nobody's case that the spectrum belongs to anyone other than the Union of India. The licence gives a right to use.

Salve: The right to use spectrum is one conferred through licence, it is a concessional right and is very valuable. There is no other right that can be claimed on spectrum beyond this.

Salve: Spectrum is not something one can claim possession over. Spectrum is just there. The government holds this is in trust but a telecom company does not become a trustee when it is given licence. As a natural resource, spectrum will always vest with the people

Supreme Court asks how spectrum is brought under the assets of a company.

Salve explains that the right to use the spectrum is an asset of a company

Salve: Spectrum is recorded as an asset by virtue of being purchased in an auction

Salve: This is a premature question... Resolution Professional for RCom filed yesterday which said it will be sold subject to DOT's nod. This impression being created that spectrum itself will be sold is wrong...

Salve urges that the question of whether spectrum can be sold or not under IBC is a premature question.

He argues that sale will take place only with DOT's nod when the resolution plan is approved.

Salve: Today this question is not right for my Lordships to consider.

Salve argues that any decision in relation to sale of spectrum at this stage may create legal problems in the current transactions.

Supreme Court asks if whenever transfer of rights takes place, will it be transferred to the IRP.

Salve says, "yes, on an as is when is basis."

On experiencing some echo in sound during the proceedings, Bench asks all the participants except Salve to mute their mics.

Justice Mishra points out that there are 89 lawyers logged in for this hearing.

"We can't see everyone but 89 lawyers have joined."

Salve continues to read through Section 18 of the IBC.

In a slight deviation from the hearing -

Justice Mishra: When I started hearing the case I knew very little. But everyone has taught me a lot ... Sibal ji, Ramji, Shyam ji taught me a lot.

On a lighter note, Justice Mishra asks Senior Advocate Ranjit Kumar if hearing should be continued beyond 4 PM.

Yesterday, Kumar had requested for hearing to be stopped at 4PM.

Today, he expressed regret for yesterday's request.

Salve: My Lord is taking on too much in the last few days, I feel.

Justice Mishra: Now I am fed up...

Salve: My Lords shouldn't... Cases gone, money gone, governments gone, one judgment will not solve many a problems, My Lord.

Salve is taking the Court through the series of events and important dates in the case

Salve finishes taking the Court through previous orders and important dates.

Salve: I have finished with this part of my case. Would Your Lordships want me to address on the larger question of natural resources?

Justice Mishra: If you enlighten us a little, it will be better

Salve: Always a pleasure to assist my Lords. The most important case on this issue is the Natural Resources case.

Salve: The principle held was that the government cannot sell exclusive rights to natural resources. Resources like rivers, beaches are all held by the government in trust

Salve: Even the taxpayers' money is held by the government in trust. In fact the whole concept of governance is "trust."

Salve: Another important case on this issue is Your Lordships' judgment in the AGR case (October 2019). The heart of the matter is that the subject is governed by the contracts and these contracts have to be rigorously enforced.

Salve: Corporate debtors are not running away from AGR. Contracts have to be rigorously applied...

Salve: This is not alien to resolution proceedings. One thing is clear that DOT's nod is required. It cannot be sold without the DOT's nod.

Salve concludes his arguments, says he will file a short note before the Court.

Supreme Court is fixing up the schedule for tomorrow's hearing.

Hearing concludes for today, will continue tomorrow at 2PM.

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