- By Aditya Pratap Singh
- Thu, 19 Sep 2024 03:19 PM (IST)
- Source:JND
Amidst a continuing dispute over the payment of dues to the government, the Supreme Court on Wednesday dismissed a petition by telecom companies for a recalculation of adjusted gross revenue or AGR. The companies expressed concern over the financial crisis affecting all firms.
In October 2019, Vodafone India, Bharti Airtel and others filed curative petitions against the court’s verdict which had directed the government to pay Rs 92,000 crores within three months. The present applications are against an order in September 2020 requiring payment of AGR dues within 10 years, 10 per cent of the total by 31st March each year.
In their petition today, the telecom firms claimed a gross error by the Department of Telecommunications (DoT) in calculating those dues — license fees and spectrum charges.
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Telecom companies have over 1 lakh crore AGR dues
The reports indicate that the AGR dues calculated by DoT total more than Rs 1 lakh crore; Airtel's debt is estimated at Rs 43,980 crore and Vodafone's at Rs 58,254 crore. However, according to the companies’ accounts, Airtel says its debt is only ₹ 13,004 crore and Vodafone has claimed dues of only ₹ 21,533 crore.
A similar recalculation was done for dues owed by other companies, including Tata Teleservices. The telecom firms also accused the court of arbitrary punishment.
The calculation of AGR is the basis for sharing revenues between telecom firms and the government, which receives payment for license allocation and spectrum usage. DoT calculates the government’s share as a percentage of AGR. This amounts to three to five per cent in spectrum usage fees and eight per cent in license fees.
However, exactly how AGR is calculated has been a contentious issue for nearly two decades now, with telecom firms insisting that only core revenue must be included. The government, however, includes all revenues in the accounts, including those from non-telecom channels.
In 2019, the Supreme Court ruled in favour of the government and directed telecom companies to pay Rs 92,000 crores within 180 days. That order hit the telecom industry hard; Vodafone India and Bharti Airtel posted record losses in the following days.
