Six telecom companies under-reported revenue by over Rs 61,000 crore: CAG
Private telecom operators have understated revenues worth over Rs 61,000 crore from 2010 to 2015, leading to a shortage of payment to exchequer, a report by the Comptroller and Auditor General revealed on Friday.
The CAG audited six telecom companies — Bharti Airtel, Vodafone, Aircel, Idea, Reliance Communication and Sistema Shyam Teleservices Ltd.
The report tabled in Parliament said the companies under-reported their adjusted gross revenue (AGR) by Rs 61,064 crore during 2010-2015. This reduced the government’s earnings in the form of spectrum charges and licensing by Rs 7,697.6 crore.
The report said the understatement was due to promotional schemes such as free talk time and discounts paid to postpaid subscribers on roaming services besides accounting adjustments for commission or discount paid to distributors.
According to the report, the netting of revenue from infrastructure sharing and non-inclusion of forex gains, interest income and sale of investment also led to understating of revenue. An amount of Rs 4,531 crore as interest arising out of short term payments is also due.
Under the New Telecom Policy, telecom licensees are mandated to share a percentage of their adjusted gross revenue with the government. Telephone operators, in addition, were required to pay Spectrum Usage Charges to use radio frequency spectrum allotted to them. “This is not new and this is the result of difference in understanding the definition of AGR and how it is to be calculated... this issue needs to be worked out,” said Rajan S Mathews, director general of Cellular Operators Association of India.