TELCOS GET 10 YRS FOR PAYMENT

The Supreme Court on Tuesday allowed the telecom companies 10 years to pay up their dues related to adjusted gross revenue (AGR); this is a big relief to all, especially to Vodafone Idea Ltd which would have folded up if asked to cough up over Rs 58,000 crore dues in one go.

A 3-judge Bench headed by Justice Arun Mishra, for whom this is one of the last verdicts before he retires on Wednesday, asked the telcos to make 10% upfront payment of their AGR dues; the timeline for the staggered payments starts from April 1, 2021. The two other judges on the Bench were Justices S Abdul Nazeer and M R Shah.

The Bench sought an undertaking from the MDs and CEOs of the telecom companies for the payment, warning that failure to pay instalments will incur penalty, interest and contempt of court.

Vodafone Idea and rival Bharti Airtel had sought 15 years to pay AGR dues, while Tata Teleservices Ltd wanted 7-10 years. Reliance Jio, which was launched in September 2016, had paid its relatively minuscule dues of Rs 195.18 crore in January.

The department of telecommunications (DoT) had in March appealed to the apex court seeking 20 years timeline for payment of AGR dues, including spectrum usage charge, interest, penalty and interest on penalty. However, the Supreme Court had reservations about granting 20 years' time to telcos, expressing doubt over recovery of dues, especially from Vodafone Idea which has severe liquidity problems.

On October 24 last year, the apex court upheld the DoT’s broader definition of AGR and ordered telcos to pay levies based on that definition, along with interest on the principal amount and penalty. The DoT calculates levies such as SUC and licence fees based on AGR.

The court directed 15 telcos, including the ones which have shut operations, to pay ₹ 1.47 trillion in AGR dues within three months. In subsequent hearings, the court had rejected dues based on self-assessment by telcos, saying that the calculations of the DoT were final.