The Supreme Court on Thursday said it was “totally impermissible” for the Department of Telecommunications (DoT) to “misuse” a judgment of the Apex Court to demand ₹4 lakh crore in adjusted gross revenue (AGR) from public sector undertakings.
A three-judge Bench led by Justice Arun Mishra also questioned the viability of the government’s 20-year ‘formula’ for telecom companies to repay their AGR dues to the tune of ₹1.42 lakh crore. “Twenty years is too long a period. If companies go into liquidation, what will happen? How to secure (the dues)?” Justice Mishra asked.
Solicitor General Tushar Mehta, appearing for the government, said the formula was chalked out considering the “impact” such huge pay-outs may have on the private telecom sector. He said the companies would be in the best position to tell the court about how they would guarantee payment.
Senior advocates Arvind Datar for Tata, A.M. Singhvi for Bharti Airtel and Kapil Sibal for Hughes sought time to file detailed responses to the court’s queries, saying it was a serious matter concerning huge sums.
The court finally asked the telecom companies to file affidavits detailing the “personal guarantee” they could put on the table to ensure the payment of dues within a fixed time frame.
Meanwhile, the Bench threatened contempt action against the officials responsible for the demand on PSUs.
Justice Mishra pointed out the court’s October 2019 judgment, directing telecom companies to pay AGR dues in three months, was completely silent with regard to public sector undertakings.
Warns of contempt
“You withdraw this or we will take strict action. We will punish them with contempt,” Justice Mishra told Mr. Mehta who suggested the court add a line in its order clarifying the judgment did not include PSUs.
But the court refused and directed the government to file an affidavit within a week, explaining this demand made on PSUs using the verdict as a basis.