The Supreme Court on Friday declined to grant an interim stay on the Bombay High Court’s June 8 judgment that quashed the Centre’s demands for One-Time Spectrum Charges (OTSC) against Bharti Airtel and Vodafone Idea.
The apex court, however, agreed to examine the Department of Telecommunications (DoT) appeal against the Bombay High Court ruling and issued notice on the Centre’s plea.
A bench comprising Justice B.V. Nagarathna and Justice R. Mahadevan rejected the government’s request to stay the High Court’s order, which had also directed the release of bank guarantees. The Centre told the court that the bank guarantees involved were worth around ₹3,300 crore.
Airtel and Vodafone Idea Get Immediate Relief
The Supreme Court’s decision provides immediate relief to the two telecom operators, as the Bombay High Court judgment remains operative while the Centre’s appeal is considered.
The June 8 ruling brought an end to more than a decade of litigation by quashing the Centre’s retrospective OTSC demands on spectrum holdings above 6.2 MHz, dating back to 2008.
Following the Bombay High Court verdict, Bharti Airtel estimated the total financial relief from the ruling at approximately ₹8,414 crore, according to its June 9 stock exchange filing.
Airtel’s FY26 annual report also disclosed an accumulated interest liability of approximately ₹12,137 crore on the original OTSC demand through March 2026.
Vodafone Idea’s Exposure
Vodafone Idea said in its June 9 exchange filing that the Bombay High Court order quashed government demand notices relating to OTSC amounting to ₹2,113 crore.
The company’s FY26 annual report showed an accumulated provision of around ₹8,780 crore towards these charges.
The two telecom stocks were trading higher during Friday afternoon trade, with Bharti Airtel gaining around 0.38% to ₹1,955.50, while Vodafone Idea rose approximately 0.55% to ₹12.70 around 3 pm.
Why the Centre Is Challenging the High Court Order
The Centre argued before the Supreme Court that spectrum is a valuable natural resource held by the government in public trust.
The government’s counsel contended that telecom companies had obtained spectrum at rates below market value and that the OTSC was introduced to recover its appropriate economic value.
The Centre also argued that the Bombay High Court judgment was inconsistent with a 2016 Madras High Court ruling, which had upheld an OTSC demand of around ₹3,273 crore against Aircel.
The government sought to have its appeal considered alongside other pending Supreme Court proceedings concerning the retrospective spectrum levy.
Airtel and Vodafone Idea Oppose Centre’s Plea
Senior advocates representing the telecom operators opposed the request for an interim stay.
Mukul Rohatgi, appearing for Vodafone Idea, argued that the Bombay High Court had correctly concluded that there was no statutory or contractual basis for imposing the OTSC retrospectively.
Representing Airtel, Shyam Divan also opposed the Centre’s plea.
The telecom companies maintained that they had already paid applicable entry fees, licence fees and spectrum usage charges under their existing licence agreements and that the government could not subsequently impose a retrospective charge that was not contemplated under those agreements.
How the OTSC Dispute Began
The dispute dates back to 2012, when the Union government decided to impose a one-time spectrum charge on spectrum holdings above 6.2 MHz, with retrospective effect from July 2008.
The DoT subsequently issued demand notices to telecom operators, including Airtel and Vodafone Idea.
The companies challenged the levy before the Bombay High Court in 2013, arguing that the retrospective demand lacked legal and contractual basis.
The High Court granted interim protection to the operators in January 2013. After years of litigation, it finally quashed the demands in June 2026, holding that the applicable licence agreements and law did not permit the retrospective levy.
Broader OTSC Dispute Still Pending
While the Bombay High Court judgment provides relief to Airtel and Vodafone Idea, the broader legal dispute over OTSC remains before the Supreme Court through parallel proceedings.
In 2019, the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) had held that the OTSC could be imposed prospectively but not retrospectively. The DoT subsequently challenged that ruling.
The Supreme Court’s decision to hear the Centre’s appeal means the legal battle over the government’s power to impose the charge retrospectively is not yet over.
Key Takeaways
- Supreme Court refuses interim stay on Bombay High Court’s OTSC ruling.
- DoT’s appeal against the High Court judgment will be examined by the Supreme Court.
- Airtel estimated relief of around ₹8,414 crore.
- Vodafone Idea had OTSC demands of approximately ₹2,113 crore quashed.
- Airtel had disclosed accumulated interest liability of about ₹12,137 crore.
- Vodafone Idea had provided around ₹8,780 crore towards the charges.
- The dispute originated from the Centre’s 2012 decision to retrospectively levy OTSC from July 2008.
- The broader legal issue remains pending before the Supreme Court.
