In a landmark verdict that settles the conflict between India’s insolvency framework and the sovereign regulation of natural resources, the Supreme Court has ruled that spectrum allocated to Telecom Service Providers (TSPs) cannot be subjected to proceedings under the Insolvency and Bankruptcy Code, 2016 (IBC). The Apex Court held that spectrum is a natural resource held by the government in public trust, and while it may be recorded as an “intangible asset” in a company’s books for accounting purposes, TSPs do not possess the necessary ownership title to subject it to insolvency resolution or liquidation.
The Division Bench, comprising Justice Pamidighantam Sri Narasimha and Justice Atul S. Chandurkar, delivered the…