Allow telcos to pay dues over 20 years: Centre to top court

NEWDELHI: The Union government sought the Supreme Court’s permission on Monday to allow telecom companies to pay licence and spectrum usage fee dues over a 20-year period, offering a lastminute lifeline to several operators who have to cough up tens of thousands of crores after they lost a dispute with the ministry over how they calculate revenue.

In an affidavit to the top court on the eve of the next hearing on the matter, the department of telecommunications (DoT) also proposed the companies pay a reduced annual interest rate of 8%. The dues — a result of the top court’s October 24 order revising adjusted gross revenue (AGR) calculation in favour of the government — stood at ₹1.69 lakh crore as of October, the department said in the affidavit.

The move was meant to protect consumers as well as impact the country’s economy, the department said. If as a consequence of the judgment, any of the major service providers go into insolvency, consumers will be jeopardised because porting mobile numbers from a non-operational to an operational service provider will take considerable, the affidavit said.

The hearing in the matter, however, has been pushed back since only a few benches are holding hearings. The top court has pared back hearings to thin crowds in view of the coronavirus disease (Covid-19) outbreak.

According to latest figures submitted by DoT, Vodafone Idea owes ₹54,754 crore, Bharti Airtel ₹25,976 crore, Reliance Communication ₹25,194 crore and Tata Group ₹12,601 crore.

The proposal, if approved by the court, will offer a lifeline to Vodafone Idea, whose executives have on several occasions said the top court ruling puts its ability to exist as a company in doubt. The company has assessed its dues to the department at ₹21,533 crore.

Vodafone Idea paid a second instalment of ₹3,384 crore to the government on Monday, taking its total payments to ₹6,854 crore, which is the entire principal amount it had self-assessed as dues related to the court’s order

on adjusted gross revenue.

The top court in its judgment delivered on October 24, 2019, had upheld the interpretation given to the definition of AGR by the DoT and included revenues from various heads for calculation of AGR thereby imposing a cumulative burden of over ₹1.69 lakh crore on 16 telecom companies.

Review petitions against the judgment were dismissed by the court on January 16.

The DoT then issued an office direction on January 23 which stated that no coercive action should be taken against companies until further orders, thereby effectively keeping the Supreme Court judgment in abeyance.

Subsequently, various telecom companies filed applications in the top court seeking extension of time for making payment of dues.

When those applications came up for hearing on February 14, a bench of justices Arun Mishra, S Abdul Nazeer and MR Shah took strong objection to the DoT’s office direction to keep the SC judgment in abeyance.

It had said that the office direction was a device to scuttle the order of the top court and such a direction must not have been

passed at all.

The court directed on February 14 that if its order was not complied with, the managing directors and directors of the defaulting telecom companies should be present in court on the next date of hearing which was kept for March 17.

The DoT’s plea was mentioned before justice Arun Mishra on Monday by centre’s second senior-most law officer, solicitor general Tushar Mehta who sought listing of the plea. Mehta pointed out that the case was scheduled to be taken up on March 17, Tuesday.

Justice Mishra said that the bench hearing the case will not be available for the time being since the Supreme Court is functioning in a restricted manner due to coronavirus threat. He agreed to list the plea as and when the bench, which passed the judgment in October 2019, becomes available.

Besides private telecom companies, various public sector units like GAIL India, Power Grid Corporation, Oil India, and Gujarat Narmada Valley Fertilisers who held telecom licenses for internal communications were also hit by the Supreme Court judgment.