SC lashes out at telcos for self-assessing dues

The Supreme Court on Wednesday pulled up the telecom service providers (TSPs) for undertaking the self-assessment, or reassessment, of the adjusted gross revenue (AGR) dues decided by its October 24, 2019 judgment and took exception to articles appearing in the newspapers relating to AGR concealing the truth.

In a warning to the top echelons of the TSPs, a bench headed by Justice Arun Mishra, and comprising Justices Abdul Nazeer and M.R.Shah, said all the managing directors of telecom service providers would be made personally responsible and hauled up for contempt if any such write-up concealing truth appeared in future.

Telling in an unequivocal terms that amount decided by its October 24 judgment was final, the court described as "fraud" the TSPs carrying out selfassessment of their respective AGR dues.

"We will be party to fraud if we allow selfassessment of AGR dues by telecom companies," the court said, making it clear that it cannot permit encroachment of its powers by allowing selfassessment by TSPs.

Expressing its displeasure over the way its October 24 order, directing TSPs to pay outstanding AGR dues of Rs. 92,000 crore, was sought to be scuttled, the court deferred, by two weeks, hearing on the Centre's rescue plan to give service providers a window of 20 years to pay AGR dues in annual installments coupled with interest.

"The time-frame of 20 years is unreasonable. The telecom companies have to clear all dues mentioned in the judgment," the court said noting that till other day, when the matter was argued before it leading to October 24 judgment, the Centre had "fought tooth and nail for levying interests and penalties."

The desk-officer of the department of telecommunications (DoT) was again in trouble as the court said it would summon the secretary, DoT and desk officer for permitting the TSPs to carry out self-assessment of their respective AGR dues.

In the last hearing of the matter DoT's desk-officer invited the wrath of the top court for issuing a communication on January 23, that had said that no coercive action be taken against the service providers for not complying with the court's October 24 order.

A Bloomberg report said the ruling could send Vodafone Idea into bankruptcy. It now leaves few options for Vodafone Idea, which owes $4 billion -- of which the carrier has paid about $930 million. It also comes as a disappointment to rival Bharti Airtel, the other survivor of a brutal price war sparked by the entry of Reliance Jio Infocomm in 2016.

While Bharti Airtel has raised funds to meet the payment demand by way of rights issue of shares and bond sales, Vodafone Idea has pinned its hopes on a relief package. UKbased Vodafone, which owns about 45 per cent of the local venture, has signalled its reluctance to plow any more money.

Shares of Vodafone Idea plunged 35 per cent and Bharti Airtel fell over 6 per cent.