NEW DELHI: The Supreme Court on Monday reserved its order on the timeline of payment of adjusted gross revenue (AGR) related dues by telecom companies, including Vodafone Idea, Bharti Airtel, and Tata Teleservices. Both Vodafone Idea and Bharti Airtel have requested for a 15-year window to clear the dues.
The apex court reiterated that there is "no room for self-assessment" and telcos have to treat the AGR dues estimated by the telecom department as final.
The court also expressed doubt over Vodafone Idea's capacity to clear the dues, asking how it could "rely" on the company for payment over a period given its financial position. The telco has sought 15 years to pay the dues versus 20 years earlier, accepting dues estimated by the DoT.
Mukul Rohatgi, representing Vodafone Idea, said all revenues have been spent on liabilities, tax and dues, with over ₹1 trillion of equity brought in by promoters being eroded.
"The entire net worth of the company (Vodafone Idea) has been wiped out in the last 15 years...Of the total revenue of ₹6.27 trillion earned in the past 10 years, ₹4.95 trillion has been spent on expenses ," Rohatgi told SC.
Abhishek Manu Singhvi, counsel for Bharti Airtel, said the DoT has wrongly calculated its dues which includes spectrum usage charges (SUC). Singhvi said AGR dues do not involve SUC but only licence fees.
Shares of Vodafone Idea ended up 1.8% at ₹9.04 on Monday, while that of Bharti Airtel rose 1.5% to ₹575.75 on the BSE. The benchmark Sensex settled at 37,418.99 points, up over 1% from the previous close.
The apex court on 18 June had asked telcos including Vodafone Idea, Bharti Airtel and Tata Teleservices to submit financial statements and books of accounts of the last 10 years to assess their capacity to clear the dues. The DoT had requested the court to allow a 20-year window for payment of dues, for which the apex court had sought a roadmap.
In its judgement on 24 October, the apex court upheld the DoT’s broader definition of AGR and ordered telecom companies 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.
On Friday, Vodafone Idea paid the DoT another ₹1,000 crore as part of its dues related to AGR, taking the beleaguered telecom operator’s total payments to ₹7,854 crore. The DoT’s estimate for Vodafone Idea was ₹58,254 crore, of which around ₹50,000 crore is still outstanding.
For Bharti Airtel, the DoT estimate stands at ₹43,780 crore, but according to the telco’s self assessment, it owes ₹13,004 crore to the DoT. The telco has already paid this amount along with an additional ₹5,000 crore in ad-hoc payment subject to refund at a later stage after the DoT reconciles its own estimates with that of the telco.
Reliance Jio Infocomm has already paid ₹195 crore to the DoT, clearing its dues accounted till 31 January. Jio’s dues were the lowest among all telcos as the Mukesh Ambani-led telelcom company was launched in September 2016.
Last week, three public-sector companies-- Gail (India), Power Grid Corp of India and Oil India -- said the DoT has withdrawn its demand notices for payment of AGR-related dues to the tune of ₹4 trillion. The SC had slammed the DoT for asking public-sector firms to clear AGR dues, calling it a “misuse" of its 24 October judgement.
According to DoT estimates, GAIL received demand notices for 2001-02 to 2018-19 from DoT with AGR dues worth ₹1.83 trillion. For Power Grid and Oil India, the amounts stood at ₹40,000 crore (FY07-FY19) and ₹48,489 crore (FY08-FY19), respectively.
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