Connect (India) Mobile Technologies Pvt. Ltd., (formerly Hutchison Max Paging Pvt. Ltd.) v. State of Kerala and Others

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** **THE HONOURABLE MR. JUSTICE DEVAN RAMACHANDRAN** **FRIDAY, THE 17TH DAY OF FEBRUARY 2017/28TH MAGHA, 1938** **WP(C).No. 26943 of 2010 (P) ----------------------------** **PETITIONER(S): -------------** **CONNECT (INDIA) MOBILE TECHNOLOGIES PVT. LTD., FORMERLY KNOWN AS HUTCHISON MAX PAGING PVT.LTD., ASHISH BUILDING, COCHIN-31, REPRESENTED BY ITS AUTHORISED SIGNATORY, RAJESH MELETH VEETTIL, AGED 40 YEARS, S/O.RAGHAVAN MELETH VEETIL.** **BY ADV. SRI.P.SATHISAN** **RESPONDENT(S):** **--------------** **1. STATE OF KERALA, REPRESENTED BY ITS SECRETARY, LOCAL SELF GOVERNMENT DEPARTMENT, SECRETARIAT, THIRUVANANTHAPURAM.** **2. SECRETARY, TIRUR MUNICIPALITY, MUNICIPAL OFFICE, TIRUR, MALAPPURAM DISTRICT.** **3. TIRUR MUNICIPALITY, REPRESENTED BY SECRETARY, TIRUR, MALAPPURAM DISTRICT.** **R1 BY GOVERNMENT PLEADER SMT.MABLR C.KURIAN R2 & R3 BY SRI.K.I.ABDUL RASHEED** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 17-02-2017, ALONG WITH WPC. 34516/2011 AND WPC. 34356/2015, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **msv/** ## **WP(C).No. 26943 of 2010 (P)** ## **----------------------------** ## **APPENDIX** ## **PETITIONER(S)' EXHIBITS** **-----------------------** **EXHIBIT-P1 TRUE COPY OF THE NOTICE DATED 12.8.2010 ISSUED BY THE 2ND RESPONDENT.** **EXHIBIT P1(a) TRUE COPY OF THE PREVIOUS NOTICE.** **EXHIBIT-P2 TRUE COPY OF THE SUBMISSION MADE BY THE PETITIONER BEFORE THE 2ND RESPONDENT.** **EXHIBIT-P3 TRUE COPY OF THE APPEAL FILED BEFORE THE 2ND RESPONDENT.** **EXHIBIT-P4 TRUE COPY OF THE JUDGMENT IN WPC.NO.15989/2008 DTD.29.5.2008.** **RESPONDENT(S)' EXHIBITS** **-----------------------** ## **NIL** ## **//TRUE COPY//** **P.S.TO JUDGE** **Msv/** ## **DEVAN RAMACHANDRAN, J. ----------------------------------------------------WP(C) Nos.26943 of 2010, 34516 of 2011 & 34356 of 2015** **----------------------------------------------------Dated this the 17[th] day of February, 2017** ## **JUDGMENT** These three writ petitions have been filed by the same petitioner. Since the writ petitions involve similar averments, similar claims and have sought similar reliefs, I deem it appropriate that all the three be heard together and disposed of jointly. For the sake of convenience I treat WP(C) No.34356 of 2015 as a lead case and reference to parties in this judgment will be as they are arrayed in the party array in the said case. 2. Petitioner is a Telecom Service Provider and they say that they are storing Subscriber Identification Module [SIM] Cards in their shop rooms within the jurisdiction of the various Local Self Government Authorities. They are aggrieved by the fact that when they applied to the Local Self Government Institutions **WP(C) Nos.26943 of 2010, 34516 of 2011 & 34356 of 2015** **2** [LSGI] for licence under Section 232 of the Kerala Panchayat Raj Act [herein after referred to as ‘the Act], and Section 447 of the Kerala Municipalities Act [herein after referred to as ‘the Municipalities Act], the Institutions did not classify their goods as merely SIM Cards but as electronic goods or Telecommunication Articles which exposes them to an action under the various Taxation Acts. The petitioner is resting all their assertions on the judgment of the Hon’ble Supreme Court in _**Bharat Sanchar Nigam Limited and Another v. Union of India and Others**_ _**[STC (2006) 91],**_ wherein the Hon’ble Court has declared the law that SIM Cards cannot be classified as electronic goods or Telecommunication articles. The petitioner says that, therefore, that the classification of the SIM Cards, which are kept in stock in their shops as either electronic goods or Telecommunication articles by the various LSGI would amount to the violation of the ratio declared by the Hon’ble Supreme Court and that it would also expose them to unnecessary legal action. They have, therefore, approached this Court by filing this writ petition, **WP(C) Nos.26943 of 2010, 34516 of 2011 & 34356 of 2015** **3** seeking directions to the Government to consider their case as has been detailed by them in Ext.P5 representation. 3. I have heard Mr.P. Satheesan, the learned counsel appearing for the petitioner, the learned Standing Counsel appearing for the Perinthelmanna Municipality, Tirur Municipality and the learned Government Pleader appearing for the official respondent. 4. As I have already indicated above, the essential case of the petitioner is that by forcing them to classify the SIM Cards stored by them as either electronic goods or telecommunication articles by the various LSGI, it would cause them grave prejudice since such classification would expose them to various action in the realm of the fiscal laws, which may be initiated by the Tax authorities on the ground that they are dealing in such articles. They say, based on the directions of the Hon’ble Supreme Court, that SIM Cards cannot be classified as such since the indubitable declaration of the said judgment in _**BSNL v. Union of India and Others**_ [supra] is that SIM Cards cannot be classified as **WP(C) Nos.26943 of 2010, 34516 of 2011 & 34356 of 2015** **4** electronic or telecommunication goods. They, therefore, say that the insistence of Local Self Government Authorities in issuing certificates in the name of electronic articles and telecommunication goods is completely irregular and unacceptable. 5. However, I see that there is a practical problem in this case, which is that under the provisions of Section 232 of the Act or Section 447 of the Municipalities Act, there is an enumerated list of articles in which licence is mandated to be obtained under the provisions of those statutes. It appears that a head under the name SIM Cards is not available in any of those classification. The LSG authorities, therefore, seem to have classified these articles under the available head namely either as electronic goods or as telecommunication articles. This is the issue that has been highlighted by the petitioner also. They pray that the Government direct all the LSGI under the provisions of the Act and the Municipalities Act to cause necessary notification to be issued, as they are competent to do under the provisions of those **WP(C) Nos.26943 of 2010, 34516 of 2011 & 34356 of 2015** **5** Acts, to classify the SIM Cards as a separate head under the name 'SIM Cards' or such other appropriate head so as not to force the petitioners to obtain licence under a misclassification of the articles stored by them. This is of course a matter, which the Government will have to consider taking into account the submissions and the materials produced by the petitioner before them. As I have already noticed above, Ext.P5 is stated to be pending before the Government, without being considered yet. 6. As regards, the other two writ petitions are concerned, they essentially deal with the contention of the petitioner that they be issued licence by two particular LSGIs, namely, Tirur Municipality and the Perinthalmanna Municipality without classifying the SIM Cards they are storing as telecommunication articles or telecommunication goods. Certainly, this will also be covered when an adjudication is made with respect to the matters covered by WP(C) No.34356 of 2015. I do not, therefore, think that any individual particular orders are to be issued in these writ petitions. **WP(C) Nos.26943 of 2010, 34516 of 2011 & 34356 of 2015 6** 7. Since I notice that Ext.P5 representation filed in WP(C) No.34356 of 2015 is still pending before the Government, it is only appropriate that the competent Secretary of the Government consider the same after affording an opportunity of being heard to the petitioner within a short frame of time. I am of the view that this shall be done by the competent Secretary within a period of four months from the date of receipt of a certified copy of this judgment. It is ordered so. 8. I make it clear that nothing contained in the judgment will limit the petitioner from approaching any particular LSGI seeking a licence under the head SIM Card or such other appropriate head and such authority will be at liberty to exercise its powers under Section 232 of the Act or Section 447 of the Municipalities Act for the purpose of notification of the articles in a particular manner without being constrained by anything that is stated in this writ petition or because that the representation of the petitioner is pending before the Government of Kerala. I also see that in WP(C) Nos.34516/2011 and 26943/2010, the **WP(C) Nos.26943 of 2010, 34516 of 2011 & 34356 of 2015** **7** petitioner has been enjoying an interim order issued by this Court as early as in the year 2011 wherein it was ordered that their operation shall not be closed down for want of licence. It is apposite, therefore, that the said order will continue until such time a decision is taken by the Government or the respective LSGI on condition that the petitioner pays the licence fee for all the years in arears within a period of 15 days from the date of receipt of a certified copy of this judgment. The respective LSGI will be entitled to retain the said amount but would not be obligated to issue licence certificates until such time as a decision as afore-directed is taken. I think this is an appropriate case where the petitioner will have to remit the amounts of licence for the entire period covered in these two writ petitions, which shall be retained by the Panchayat and the Panchayat will have to decide whether a licence can be given under the particular head relating exclusively to SIM Cards or otherwise as has been directed above. 9. Any decision that the Government takes on Ext.P5, **WP(C) Nos.26943 of 2010, 34516 of 2011 & 34356 of 2015 8** obviously will only be in the form of a recommendation of the various LSGIs to classify the SIM Cards under a particular head exclusive to it and it will be open to the respective LSGIs to make such classification by necessary notification in the Gazette in the manner prescribed under Section 232 of the Act and Section 447 of the Municipalities Act. These writ petitions are ordered as above. In the facts and circumstances of this case, I make no order as to costs and I direct the parties to suffer their respective costs. Sd/- **DEVAN RAMACHANDRAN, JUDGE.** //True Copy// P.A. to Judge sp/21/02/17