JUDGMENT
A.K. Srivastava, J.
1. The petitioner, M/s Escotel Mobile Communications (P) Ltd., is the licensee of Union of India under licence Agreement dated 12.12.1995 to establish, maintain and operate cellular mobile telephone service in Haryana Territorial Telecom Circle.
2. This petition has been moved under selection 9 of the Arbitration and Conciliation Act, 1996 (for short the “Act”) with the prayers that the Union of India through the Secretary, Ministry of Communications & Chairman, Telecom Commission be restrained from interfering with or obstructing or causing or permitting to cause anybody else to interfere with or obstruct with the applicant in providing in the town of Panchkula the cellular Mobile Telephone Service as part and parcel of the Haryana Territorial Telecom circle. It was also prayed that the respondent be directed not to permit the licensees of Punjab Telecom Circle from providing Cellular Mobile Telephone Service in Panchkula.
3. Since the Licensees of Punjab Telecom Circle were going to be affected by the prayers made in his petition M/s. Modicom Network P.Ltd and M/s J.T. Mobiles Ltd. were imp leaded as respondents in this petition. Learned counsel for the petitioner had no objection to such impleadment.
4. Briefly stated the facts of the case are that by a notice inviting tender No. 11-28/94-MMT(TM), tenders were invited for introducing Cellular Mobile Telephone Service in certain Telecom Territorial Circles. In that notice Haryana was mentioned as one of the Telecom Territorial Circles. This circle excluded local areas served by Faridabad and Gurgaon Telephone Exchange Before giving its bid the petitioner made certain queries and replies were given thereto by the respondent Union of India. Relevant extracts of the replies are as under :
“14.7 please confirm Govt, will not change conditions of the tender in a licence ?
– The licence will be based on the tender documents.
50.1 Please confirm whether per geographical area is referring to per circle awarded to the licensee.
Yes
58.10 Please clarify under which service area the status of the following states and cities are covered:
Chandigarh.
“_______Chandigarh is a part of Punjab Circle _______”
5. After getting the replies the petitioner sent its bid by letter dated June 5,1995 in which it gave bid for four circles of which Haryana was one of the circle . For Haryana circle the respondent Union of India issued licence agreement to the petitioner for Cellular Mobile Telephone Service by its letter dated 12th of December, 1995. It is , however, to be found that in the notice inviting tender, queries and answers, bid of the petitioner and the licence agreement there is no specific mention whether Panchkula was or was not part of the Haryana Telecom Circle on the date of the notice inviting tender or on the date when licence agreement was issued by the Union of India to the petitioner.
6. The cause of action for moving this petition is the letter dated 16.01.97 issued by the Ministry of communications, telecom ‘commission through it is Director (VAS-I), Kuldeep singh whereby it has been clarified that the service areas for Haryana and Punjab Telecom Territorial Circle would be the area of those circles as on the date of tender for the service and Panchkula being part of Punjab Telecom Circle will be included in the service area of licences for Punjab Circle. In the letter it is also written that the licensees of Haryana circle were not allowed to operate the service in Panchkula.
7. The petitioner, being aggrieved by the aforesaid letter , instead of making any representation to the Ministry of Communications or the Authority notified under the Licence Agreement, filed a writ petition being CWP 342/97 in this Court. In that writ petition interim orders to the effect that the respondents in that writ petition shall not interfere with the working of the petitioners company with regard to operating their system in Panchkula were passed on 31st of January, 1997, but ultimately that writ petition was dismissed on 21.3.1997 with the following observations :
“The present petition on the basis of the averments and contentions as made above, will clearly establish that the disputes have arisen between the parties as to whether Panchkula will form part of Haryana Telecom Circle or will be included in Chandigarh /Punjab circle. The matter is not free from doubt and the present proceeding, under Article 226 of the Constitution of INDIA will not be an appropriate remedy as the controversy raised between the parties will require adjudication of facts and the interpretation of tender documents. The licence agreement provides an arbitration clause which will determine the in terse disputes and differences between the parties. The petitioners are therefore provided with an equally efficacious alternative remedy which they can take recourse to.
The learned counsel has raised the plea that respondents 1 and 2 are bound by the principles as incorporated in the doctrine of Promissory Estoppel. The respondents have clearly by words and subsequent conduct held out to the petitioners that Panchkula will form part of the Haryana Telecom circle whereas the learned counsel for the respondents have argued that there has been no unequivocal promise which intended to create legal relations or affect a legal relationship between the parties. The doctrine has been explained in the judgment of the Supreme Court as reported in M/s Motilal Padampat Sugar Mills co. Ltd. Vs. The State of Uttar Pradesh and others . The relevant passage may be referred to as below :
“The true principle of promissory estoppel, therefore, seems to be that where one party has by his words or conduct made to the other a clear and unequivocal promise which is intended to create legal relations or affect a legal relationship to arise in the future, knowing or intending that it would be acted so upon by the other party to whom the promise is made and it is in fact acted upon by the other party, the promise would be binding on the party making it and he would not be entitled to go back upon it, if it would be inequitable to allow him to do so having regard to the dealings which have taken place between the parties, and this would be so irrespective weather there is any preexisting relationship between the parties or not. ”
The facts of the present case and the contentions raised in this petition cannot positively establish that respondents No. 1 and 2 have held out any clear and unequivocal promise. The matter will require consideration as to whether the bid submitted by the petitioners for Haryana Telecom Circle will include Panchkula or whether it will form part of Chandigarh and Punjab Circle and this can only be adjudicated by appropriate proceedings as envisaged in the agreement entered into between the parties. This contention can also not be entertained and is liable to be rejected.
In view of the above, there is no merit in this petition and the same is dismissed in limine.”
8. The factual situation as after the aforesaid order is that the petitioner has no stay order in its favour and is not operating cellular service in the town of Panchkula.
9. After losing in the said writ petition, the petitioner invoked the arbitration clause of the Licence Agreement and pending adjudication of the disputes by the arbitrator, has filed this petition under Section 9 of ‘the Act’ for interim protection.
10. When the petition came up for hearing, a legal plea was taken up by the learned counsel for the Union of India that this Court had no jurisdiction to hear the petition. On that plea, taking the same as preliminary, hearing was made and order was passed on 7.4.1997. That order shall form part of this order.
11. The petitioner is agitating that Panchkula is part and parcel of the Haryana Territorial Telecom Circle and the respondent, Union of India, was not justified in issuing the impugned letter dated 16.1.1997.
12. On the other hand, the consistent case of all the three respondents is that Panchkula was never part of Haryana Territorial Telecom Circle and Panchkula Exchange being part of Chandigarh Exchange was always part of Punjab Territorial Telecom Service.
13. Thus one of the questions for consideration before granting or refusing the prayers made in this petition would be ‘whether Panchkula falls within the Haryana Territorial Telecom Circle envisaged by the Licence Agreement dated 12.12.1995 entered into between the petitioner and respondent, Union of India.
14. During the course of arguments, learned counsel for the petitioner contended that if from the tender documents and the licence agreement it is not clear whether Panchkula was part of the Haryana Territorial Telecom Circle then due to the understanding reached between the petitioner and the respondent No. 1 (Union of India) after the licence agreement was issued the petitioner is entitled to keep Panchkula as part of its licence. This plea was taken by the petitioner in the aforesaid writ petition as well where a plea was raised that respondents 1 and 2 were bound by the principles as incorporated in the doctrine of promissory estoppel. The case urged was that the respondents had clearly by words and subsequent conduct held out to the petitioner that Panchkula would form part of the Haryana Territorial Telecom Circle. As such it may also have to be examined whether the respondent Union of India had by words and subsequent conduct held out to the petitioner that Panchkula would form part of the Haryana Telecom Circle.
15. According to the petitioner, disputes and differences have arisen under the license agreement dated December 12, 1995 between the petitioner and the respondent Union of India which as per clause No. 16 of the Agreement are to be settled by sole arbitration of the Director General (Telecommunications). As such the disputes and differences between the petitioner and the respondent Union of India are to be settled by the named arbitrator.
16. In this petition, it would, therefore, not be appropriate to give findings on the aforesaid questions i.e. whether Panchkula formed part of Haryana Territorial Telecom Circle under the licence granted to the petitioner and whether principles of promissory estoppel operate against the respondent Union of India as contended by the petitioner. Only a prima facie case coupled with the principles of balance of convenience and irreparable loss would be taken into consideration to decide whether any interim protection can be given to the petitioner or not.
17. Broadly, the contentions of the learned counsel for the petitioner are that Panchkula being a revenue District of the State of Haryana it part of Haryana Territorial Telecom Circle or Punjab Telecom Territorial Telecom Circle as the licence agreement speaks of geographical area; that in case the licence agreement is not very clear about the position of Panchkula whether is lies in Haryana Territorial Circle then from whatever transpired between the petitioner and respondent No.1 (Union of India), the understanding between the parties had always been that Panchkula was part of Haryana Territorial Telecom Circle and thus included in the licence agreement in favour of the petitioner; that on the basis of that understanding the petitioner incurred heavy expenditure to the tune of rupees six crores making operational cellular mobile telephone network in the town of Panchkula and entered into a plethora of contracts and arrangements with third parties; that it raised funds from Banks etc; that it acquired equipments and materials and appointed dealers for enrolling subscribers and that it took premises on licence in the town of Panchkula for setting up antennas and tower to integrate the network. Regarding the alleged understanding between the petitioner and respondent No. 1 (Union of India), learned counsel for the petitioner relied on several documents which go to show that the petitioner applied to certain authorities from time to time for various licences, allocation of frequencies, sitting clearances and other permissions required under the licence agreement. He further contended that the various authorities of the UOI entertained those applications and granted licence permissions and allocated frequencies and also granted citing clearances, inter alia, in respect of and with specific reference to the town of Panchkula. In this respect, he led me to various documents in the file.
18. On the basis of the above, learned counsel for the petitioner contended that the petitioner has a prima facie case and the balance of convenience also lied in its favour.
19. On the other hand, the stand of respondent No. 1 UOI is that town of Panchkula was never a part of Haryana Territorial Telecom Circle; that the relevant tender document and the licence agreement do not include Panchkula in it; that the designated authority or the UOI in the Ministry of Telecommunication never, after the licence agreement, gave out to the petitioner that Panchkula was part of its licence and, that in view of the fact that Panchkula was part of Chandigarh exchange which in its turn was part of Punjab Circle, there was no question of Panchkula being part of Haryana Circle and the same was known to everybody at the time of the tender document and also at the time of the licence agreement. It has also been contended that the balance of convenience does not lie in favour of the petitioner and in case the petitioner is allowed to operate Cellular Telephone Service for Panchkula town it would rather create serious problems as Panchkula being part of the Punjab circle operational rights for Cellular mobile service in the town of Panchkula are with third parties.
20. Learned counsel for respondents No. 2 and 3 submitted argument on similar lines as were submitted on behalf of respondent No. 1. Mr. A.S. Chandhioke appearing for respondent No. 2 invited my attention to certain documents on the file which, according to him, counter the arguments on behalf of the petitioner that an understanding reached between the petitioner and respondent No. 1 that Panchkula was part of Haryana Circle and thus covered by the licence in favour of the petitioner.
21. Having heard the learned counsel for the parties and having gone through the documents on record, I am not inclined to grant any interim protection to the petitioner.
22. The notice inviting tender does not speak of Haryana State. It speaks of Haryana Circle with reference to geographical area. Therefore, town of Panchkula being a District of the State of Haryana may not be a guiding factor for understanding whether town of Panchkula was part of Haryana Territorial Telecom Circle on the dates of the notice inviting tender and the licence agreement. What appears from the facts and circumstances is that telephone exchanges may determine a Circle. Admittedly, Panchkula was part of Chandigarh Exchange which in turn was part of Punjab Circle when the notice inviting tender was issued and when the licence agreement was signed in favour of the petitioner. Learned counsel for the respondents also informed this Court that even today town of Panchkula is in Chandigarh Exchange. They have also invited my attention to Telephone Directory which depicts Panchkula as part of Chandigarh Exchange. After the notice inviting tender and before giving its bid, the petitioner made certain queries to respondent No.1. Against one of the queries so made, the respondent No. 1 had replied to the petitioner that Chandigarh was part of Punjab Circle.
23. Annexure F, at page 201, is the minutes of the meeting regarding public switch telephone network connectively between Haryana Telecom Circle and M/s. Escotel (the petitioner) held in the office of CGMT, Haryana Circle Ambala on 1.7.1996. In that meeting as many as seven representatives of the petitioner were present including its Chief Executive Director and CEO Shri M. Kohli. In that meeting, regarding Panchkula, Shri N.L. Sahi, General Manager (Development) Haryana Circle mentioned that “at present if is under the jurisdiction of G.M.T. Chandigarh in Punjab Telecom Circle to whom the demand may be sent.” Thus on 1.7.1996 GMT Haryana Circle had made it clear to M/s. Escotel (the petitioner) that Panchkula was under the jurisdiction of GMT Chandigarh and Punjab Telecom Circle. That statement was not disputed by Shri M.Kohli, Executive Director of the Petitioner.
24. It is to be found that before giving tender the petitioner never made any specific query to respondent No. 1 as to whether Panchkula formed part of Haryana Circle or not. From the records, it is to be found that for the first time query was made on 27.7.1996 by annexure A.7 (Page 107) asking the Chief General Manager Haryana Telecom Circle (which was the authority to invite tender document) to indicate early the geographical boundaries served by Haryana circle and also the local boundaries served by Faridabad and Gurgaon telephone exchanges. Admittedly, this letter has not been replied to by the Chief General Manager Haryana Telecom Circle till today. Only the impugned order was made on 16.1.1997 whereby it was clarified that the service areas for Haryana and Punjab Telecom Territorial Circles will be the area of these circles as on the date of tender for the service and in the present case Panchkula being part of Punjab Telecom Circle will be included in the service area of licence for Punjab Circle.
25. The letter of the petitioner dated 27.7.1996 (Annexure A-7 at page 107), creates an impression in the mind that till that date the petitioner was not clear about the geographical boundaries served by Haryana Circle and also the local areas served by Faridabad and Gurgaon Telephone Exchanges. As such any alleged understanding between the petitioner and respondent No. 1 may not be deduced till 27.7.1996 at least. Further the letters of the petitioner to the DDG (VAS). Department of Telecommunication, which are annexures A-6 dated 22.5.1996 (page 106) and A-8, dated 9.8.1996 (page 108, give the impression that the petitioner was itself of the understanding that Panchkula was not park of the licence granted to it. In the letter dated 9.8.1996, it was specifically written that “we will request you that we may please be intimated on the subject so that subsequently there are no disputes with our adjoining operators.” Subjectmatter of those letters was “Identification of Physical Geographical Boundaries, GSM Cellular Service Areas, Haryana, U.P. – West, Kerala and Gujarat”. By those letters the petitioner wanted to know the physical geographical boundaries for NOIDA/Ghaziabad/Dadri/Faridabad/Gurgaon/Panchkula and Chandigarh. Admittedly, NOIDA/Ghaziabad/Dadri/Faridabad/Gurgaon and Chandigarh were not part of Cellular Service areas of Haryana, U.P. West and Kerala. Grouping Panchkula with them may indicate that Panchkula, as per the understanding of the petitioner itself was not part of Haryana Circle for Cellular service. Had Panchkula been a part of the licence agreement, the petitioner would not have asked the physical geographical boundary of Panchkula when it asked for physical geographical boundaries for NOIDA/Ghaziabad/Dadri/Faridabad/Gurgaon and Chandigarh.
26. From the documents on record it appears that only from the month of September, 1996, the petitioner gave advertisements inviting bookings for cellular phone in Panchkula and till January. 1997, the petitioner had not started operating cellular telephone service in the town of Panchkula. By its letter dated 19.11.1996 (annexure A.11 at page 112) the petitioner had informed Mr. S.R. Singh ADG (VAS-I) that the petitioner had plans to start Cellular Telephone service in the town of Panchkula. Annexure A.12 at page 115 would go to show that till 10.12.1996 details about coordinations of frequencies in 7 Ghz band for backbone network in Haryana Circle by Ms. Escotel (petitioner) had not been finalised. By this letter details of the revised coordination were given by Shri Madan Gopal, Assistant Director General to the Wireless. Adviser to the Government of India, Ministry of Communications. Annexure A.13 at page 116, dated 20.12.1996 goes to show that sitting clearances of ten sites for cellular mobile service in Haryana Circle by M/s. Escotel (petitioner) were approved, subject to certain conditions. Annexure A.16 at page 130 is a letter dated 6.1.1997 written by the petitioner to Deputy Director General (NRC), TEC, the subjectmatter of which is “network offer for technical evaluation : GSM Network Panchkula (Haryana). By that letter the petitioner offered its cellular network at Panchkula (Haryana) for evaluation and requested for evaluation at the earliest. There is nothing on record to show as to what action was taken by the addressee but Respondent No. 1 (UOI) in its reply at page 163 has submitted that Panchkula being not included in the operation field of the applicant, the TEC could not take up the task of testing to services in Panchkula in respect of petitioner Company’s network.
27. Learned counsel for the petitioner relied on certain documents which are at pages 109, 115, and 116 of the paper book. The documents at page 109 is a memorandum dated 20 Sept. 96 signed by S.C. Khurana, Engineer, for Secretary, Standing Advisory Committee on Frequency Allocation. The subject matter of this letter is “sitting clearance of 14 sites for Cellular Mobile Telephone Service in Haryana Circle by Escotel Mobile Communications Limited.” Annexure of this memorandum mentions Panchkula at items 10, 11 and 12. The contention of the learned counsel for the petitioner is that the Secretary, SACFA had approved the sites to the petitioner and the approved sites included Panchkula. It is, however, to be noted that in Annexure 2 signed by S.C. Khurana, Condition No. 4 says that “the clearance is subject” to ratification by SACFA. The document at page 115 is a letter dated 9th/10th December, 1996 written by one Madan Gopal, Asstt. Dir. General (MW) to The Wireless Advisor to the Government of India, Ministry of Communications. The subject matter of this letter is “Coordination of frequencies in 7 CHz band for backbone network in Haryana Circle by M/s. Escotel”. It says that the proposal of the applicant for deployin RF channel 1/1 – (28 MHz plan on the Kurukshetra – Karnal – Panipat – Sonepat sections and RF channel 2/2 – (28 MHz plan for Ambala (Shanpur) – Ambala city and Karnal -Kar City has been examined and the details of the revised coordination are given below. In this letter at item No. 1 there is mention of “Panchkula – Kurukhsetra – Yamuna Nagar, ” The document at page 116 is a Memorandum dated 20.12.1996 signed by S.C. Khurana, Engineer, for Secretary SACFA. The subject matter of this Memorandum is “sitting clearance of 10 sites for cellular mobile telephone services in Haryana Circle by Escotel Mobile Communications Ltd.”. Annexure – I to this Memorandum does mention Panchkula at two places. It is, however, to be noted that in Annexure- II of this Memorandum signed by S.C. Khurana, Engineer, for Secretary SACFA, the condition No. 4 is that the clearance is subject to ratification by SACFA. The arguments advanced by the learned counsel on the basis of the aforesaid documents are that it was always in the mind of the licence and the licensor that Panch- kula was part and parcel of Haryana Circle. On the other hand the contentions of the learned counsel for the respondents had been that these documents would not create any right in the favour of the petitioner in respect of the cellular phone service at Panchkula and they were merely proposals for clearances given by third agencies who were not parties to the license agreement. It was also submitted that the licence agreement. It was also submitted that the licence agreement in favour of the petitioner had been entered into between the President of India as the licensor and the petitioner as the licensee. The agreement stated that pursuant to the request of the licensee the licensor acting through the “authority” had agreed to grant licence to the licensee on the terms and conditions contained in the agreement. The term “authority” had been defined in the agreement at page 69 saying”. Authority shall refer to the Director General. Telecommunications, Government of India, and included any officer empowered by him to perform all or any of the functions of the Authority”. Again in the agreement at page 70 the term licensor had been defined saying “Licensor shall refer to the Director General, Telecommunications, Government of India (DOT) or somebody else, so authorised to grant license under Section 4 of Indian Telegraph Act-1885 and Indian Wireless Telegraphy Act 1933, unless otherwise specified.”
28. In view of above, the authority on behalf of the licensor is the Director General, Telecommunications, Government of India. However, it is to be found that there is nothing in the record of this case which may show that there had been any exchange of letters between the Director General, Telecommunications, Government of India and the petitioner and from which it could be deduced that subsequent to the licence agreement there reached an understanding between the licensor and the licensee that Panchkula was or had been made part of the Haryana Telecom Circle. It is, however, to be found that in the engineering details (at page 96 to 106) submitted by the petitioner nowhere there is any proposal of any site etc. at Panchkula. Though the learned counsel for the petitioner made a submission that the sites of only the head quarters were mentioned in the engineering details and as such Panchkula was not shown but in the facts and circumstances of the case when for frequency, site etc. Panchkula had been mentioned by the petitioner and again Panchkula was mentioned in the proposals for sitting and frequency clearances by S.C. Khurana, Engineer, for Secretary, SACFA, it may, prima facie, be not acceptable that engineering details did not need mention of Panchkula even through cellular mobile service was to be provided by the petitioner in the city of Panchkula.
29. Learned counsel for the petitioner also submitted that the petitioner had already made huge investments for providing cellular mobile service in the city of Panchkula and it would be adversely affected if it is not all 4:7; Hm7m8m9;10Howed to operate the same. It was al urged before me that the petitioner would be suffering huge revenue loss every year.
30. I have carefully considered the respective contentions of the parties. In view of what has been said above, I am of the view that at this state of the matter, in the interests of justice, no interim protection should be granted. In the aforesaid facts and circumstances of the case, by having made huge investments the petitioner cannot claim that the balance of convenience is wholly in its favour. The licensor has taken a clear cut stand that Panchkula is not part of Haryana Circle and is part of Punjab Circle and the disputes between the petitioner and respondent No. 1 are pending for adjudication before the Arbitrator. According to the licensor Panchkula is part of the licence of Punjab Circle and therefore the licensees of Punjab Circle would be affected if the petitioner is allowed to operate cellular mobile service in the city of Panchkula. So far as the investments made by the petitioner are concerned they will still remain intact and the petitioner would be in a position to utilise the same if it wins in the arbitration proceedings. Thus it can also not be said that the petitioner is going to suffer irreparable loss. The petitioner should wait for some time more. In case the respondents 2 and 3 now make investments the same would be at their own risk as they fully know that arbitration proceedings are pending between the petitioner and the respondent No. 1 before the Arbitrator.
31. In the aforesaid circumstances, I am not inclined to give any interim protection to the petitioner and the petition is dismissed. However, it is made clear that any expression of opinion made in this order shall not prejudice the respective cases of the petitioner and the respondents before the Arbitrator.