The Supreme Court has ruled that in case of difference between the Telecom Regulatory Authority of India (TRAI) and the central government on the issue of the terms and conditions of the licences given to the telecom companies, the latter’s  decision will be supreme. 

"If there is a difference between the TRAI and the Central government with regard to a particular term or condition of a licence, as in the present case (validity of the definition of Adjusted Gross Revenue in the licence agreement), the recommendations of the TRAI will not prevail and instead the decision of the Central government will be final and binding," said an SC bench.

It further said, “the TRAI and the Tribunal had no jurisdiction to decide on the validity of the definition of Adjusted Gross Revenue in the licence agreement and to exclude certain items of revenue which were included in the definition of Adjusted Gross Revenue in the licence agreement between the licencer and the licencee".The court considered the issue of whether the enactment of the TRAI Act, 1997 in any way affected the exclusive privilege of the Central government in respect of the telecommunication activities and altered the contractual nature of the licence granted to the licencee under the proviso of the Telegraph Act.